UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 ___________________________________ 
FORM 10-Q
 ___________________________________
(Mark One)
ý☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 20172022
or
¨

☐		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________.
Commission File Number: 001-36127
  ______________________________
COOPER-STANDARD HOLDINGS INC.
(Exact name of registrant as specified in its charter)
 ______________________________
Delaware20-1945088
(State or other jurisdiction of

incorporation or organization)
(I.R.S. Employer

Identification No.)
39550 Orchard Hill Place40300 Traditions Drive
Novi,Northville, Michigan 4837548168
(Address of principal executive offices)
(Zip Code)
(248) 596-5900
(Registrant’s telephone number, including area code)
 ______________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.001 per shareCPSNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý☒    No  ¨☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ý☒    No  ¨☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerý☐Accelerated filer¨☒
Non-accelerated filer¨☐(Do not check if a smaller reporting company)Smaller reporting company¨☒
Emerging growth company¨☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨☐    No  ý☒
As of October 27, 201726, 2022, there were 17,530,79617,108,029 shares of the registrant’s common stock, $0.001 par value, outstanding.

1


COOPER-STANDARD HOLDINGS INC.
Form 10-Q
For the period ended September 30, 20172022
 
Page
PART I. FINANCIAL INFORMATION
Item 1.
3
4
5
6
7
8
Item 2.
2326
Item 3.
3137
Item 4.
3138
PART II. OTHER INFORMATION
Item 2.
3239
Item 6.
3340
3441
INDEX TO EXHIBITS AND EXHIBITS
35

2



PART I — FINANCIAL INFORMATION
Item 1.         Financial Statements
COOPER-STANDARD HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF NET INCOMEOPERATIONS
(Unaudited)
(Dollar amounts in thousands except per share amounts)
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Sales$869,016
 $855,656
 $2,680,212
 $2,597,457
Cost of products sold718,187
 690,984
 2,187,058
 2,101,000
Gross profit150,829
 164,672
 493,154
 496,457
Selling, administration & engineering expenses94,145
 92,368
 267,883
 268,498
Amortization of intangibles3,432
 3,457
 10,563
 9,974
Impairment charges—
 —
 4,270
 —
Restructuring charges9,909
 10,430
 28,220
 33,468
Other operating loss—
 —
 —
 155
Operating profit43,343
 58,417
 182,218
 184,362
Interest expense, net of interest income(10,256) (10,114) (31,788) (29,861)
Equity in earnings of affiliates660
 1,386
 3,735
 5,823
Loss on refinancing and extinguishment of debt—
 —
 (1,020) —
Other expense, net(451) (518) (3,275) (8,589)
Income before income taxes33,296
 49,171
 149,870
 151,735
Income tax expense7,838
 12,525
 40,258
 43,312
Net income25,458
 36,646
 109,612
 108,423
Net income attributable to noncontrolling interests(818) (284) (2,810) (549)
Net income attributable to Cooper-Standard Holdings Inc.$24,640
 $36,362
 $106,802
 $107,874
        
Earnings per share:       
Basic$1.39
 $2.08
 $6.01
 $6.20
Diluted$1.32
 $1.94
 $5.67
 $5.77
 Three Months Ended September 30,Nine Months Ended September 30,
 2022202120222021
Sales$657,153 $526,690 $1,876,054 $1,728,842 
Cost of products sold618,594 534,817 1,800,577 1,669,610 
Gross profit (loss)38,559 (8,127)75,477 59,232 
Selling, administration & engineering expenses44,847 60,367 149,033 168,506 
Gain on sale of business, net— — — (696)
Gain on sale of fixed assets, net— — (33,391)— 
Amortization of intangibles1,693 1,819 5,176 5,524 
Restructuring charges1,701 1,573 13,014 34,251 
Impairment charges379 1,006 837 1,847 
Operating loss(10,061)(72,892)(59,192)(150,200)
Interest expense, net of interest income(20,747)(18,243)(57,378)(54,152)
Equity in (losses) earnings of affiliates(3,391)(1,114)(8,193)65 
Other income (expense), net146 (494)(2,574)(4,221)
Loss before income taxes(34,053)(92,743)(127,337)(208,508)
Income tax (benefit) expense(833)32,121 1,824 15,598 
Net loss(33,220)(124,864)(129,161)(224,106)
Net loss attributable to noncontrolling interests534 1,691 1,868 3,458 
Net loss attributable to Cooper-Standard Holdings Inc.$(32,686)$(123,173)$(127,293)$(220,648)
Loss per share:
Basic$(1.90)$(7.20)$(7.41)$(12.96)
Diluted$(1.90)$(7.20)$(7.41)$(12.96)
The accompanying notes are an integral part of these financial statements.




3

COOPER-STANDARD HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMELOSS
(Unaudited)
(Dollar amounts in thousands)
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Net income$25,458
 $36,646
 $109,612
 $108,423
Other comprehensive income (loss):       
Currency translation adjustment16,535
 2,663
 41,204
 12,330
Benefit plan liabilities adjustment, net of tax3,963
 (149) 1,235
 (620)
Fair value change of derivatives, net of tax(966) 1,881
 617
 (605)
Other comprehensive income, net of tax19,532
 4,395
 43,056
 11,105
Comprehensive income44,990
 41,041
 152,668
 119,528
Comprehensive income attributable to noncontrolling interests(1,306) (266) (3,891) (317)
Comprehensive income attributable to Cooper-Standard Holdings Inc.$43,684
 $40,775
 $148,777
 $119,211
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Net loss$(33,220)$(124,864)$(129,161)$(224,106)
Other comprehensive income (loss):
Currency translation adjustment(18,960)(6,215)(27,679)(4,074)
Benefit plan liabilities adjustment, net of tax2,398 4,978 5,445 8,328 
Fair value change of derivatives, net of tax2,422 (2,132)3,830 (1,952)
Other comprehensive (loss) income, net of tax(14,140)(3,369)(18,404)2,302 
Comprehensive loss(47,360)(128,233)(147,565)(221,804)
Comprehensive loss attributable to noncontrolling interests185 1,916 1,253 3,744 
Comprehensive loss attributable to Cooper-Standard Holdings Inc.$(47,175)$(126,317)$(146,312)$(218,060)
The accompanying notes are an integral part of these financial statements.




4


COOPER-STANDARD HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands except share amounts)
 September 30, 2017 December 31, 2016
 (unaudited) 
Assets   
Current assets:   
Cash and cash equivalents$372,984
 $480,092
Accounts receivable, net571,515
 460,503
Tooling receivable111,543
 90,974
Inventories179,470
 146,449
Prepaid expenses42,685
 37,142
Other current assets97,845
 81,021
Total current assets1,376,042
 1,296,181
Property, plant and equipment, net916,496
 832,269
Goodwill170,765
 167,441
Intangible assets, net72,060
 81,363
Other assets100,233
 114,448
Total assets$2,635,596
 $2,491,702
    
Liabilities and Equity   
Current liabilities:   
Debt payable within one year$32,448
 $33,439
Accounts payable491,202
 475,426
Payroll liabilities138,127
 144,812
Accrued liabilities123,955
 105,665
Total current liabilities785,732
 759,342
Long-term debt722,557
 729,480
Pension benefits178,406
 172,950
Postretirement benefits other than pensions56,876
 54,225
Other liabilities47,859
 53,914
Total liabilities1,791,430
 1,769,911
7% Cumulative participating convertible preferred stock, $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding—
 —
Equity:   
Common stock, $0.001 par value, 190,000,000 shares authorized; 19,602,827 shares issued and 17,596,621 shares outstanding as of September 30, 2017, and 19,686,917 shares issued and 17,690,611 outstanding as of December 31, 201617
 17
Additional paid-in capital513,609
 513,934
Retained earnings502,806
 425,972
Accumulated other comprehensive loss(200,588) (242,563)
Total Cooper-Standard Holdings Inc. equity815,844
 697,360
Noncontrolling interests28,322
 24,431
Total equity844,166
 721,791
Total liabilities and equity$2,635,596
 $2,491,702
The accompanying notes are an integral part of these financial statements.


COOPER-STANDARD HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(Unaudited)
(Dollar amounts in thousands except share amounts)
 Total Equity
 Common Shares Common Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss Cooper-Standard Holdings Inc. Equity Noncontrolling Interests Total Equity
Balance as of December 31, 201617,690,611
 $17
 $513,934
 $425,972
 $(242,563) $697,360
 $24,431
 $721,791
Repurchase of common stock(306,072) —
 (7,407) (24,045) —
 (31,452) —
 (31,452)
Warrant exercises50,145
 —
 836
 —
 —
 836
 —
 836
Share-based compensation, net161,937
 —
 6,246
 (5,923) —
 323
 —
 323
Net income—
 —
 —
 106,802
 —
 106,802
 2,810
 109,612
Other comprehensive income—
 —
 —
 —
 41,975
 41,975
 1,081
 43,056
Balance as of September 30, 201717,596,621
 $17
 $513,609
 $502,806
 $(200,588) $815,844
 $28,322
 $844,166
September 30, 2022December 31, 2021
 (unaudited)
Assets
Current assets:
Cash and cash equivalents$231,177 $248,010 
Accounts receivable, net366,824 317,469 
Tooling receivable, net93,832 88,900 
Inventories195,003 158,075 
Prepaid expenses31,348 26,313 
Income tax receivable and refundable credits12,474 82,813 
Other current assets74,525 73,317 
Total current assets1,005,183 994,897 
Property, plant and equipment, net667,117 784,348 
Operating lease right-of-use assets, net95,803 111,052 
Goodwill141,958 142,282 
Intangible assets, net48,413 60,375 
Other assets143,727 133,539 
Total assets$2,102,201 $2,226,493 
Liabilities and Equity
Current liabilities:
Debt payable within one year$48,890 $56,111 
Accounts payable373,481 348,133 
Payroll liabilities94,712 69,353 
Accrued liabilities130,257 101,466 
Current operating lease liabilities20,172 22,552 
Total current liabilities667,512 597,615 
Long-term debt978,435 980,604 
Pension benefits113,521 129,880 
Postretirement benefits other than pensions40,960 43,498 
Long-term operating lease liabilities79,222 92,760 
Other liabilities47,289 50,776 
Total liabilities1,926,939 1,895,133 
Equity:
Common stock, $0.001 par value, 190,000,000 shares authorized; 19,173,838 shares issued and 17,108,029 shares outstanding as of September 30, 2022, and 19,057,788 shares issued and 16,991,979 outstanding as of December 31, 202117 17 
Additional paid-in capital506,971 504,497 
Retained (loss) earnings(101,740)25,553 
Accumulated other comprehensive loss(224,203)(205,184)
Total Cooper-Standard Holdings Inc. equity181,045 324,883 
Noncontrolling interests(5,783)6,477 
Total equity175,262 331,360 
Total liabilities and equity$2,102,201 $2,226,493 
The accompanying notes are an integral part of these financial statements.
5



COOPER-STANDARD HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(Unaudited)
(Dollar amounts in thousands except share amounts)
 Total Equity
 Common SharesCommon StockAdditional Paid-In CapitalRetained Earnings (Loss)Accumulated Other Comprehensive LossCooper-Standard Holdings Inc. EquityNoncontrolling InterestsTotal Equity
Balance as of December 31, 202116,991,979 $17 $504,497 $25,553 $(205,184)$324,883 $6,477 $331,360 
Share-based compensation, net69,716 — 437 — — 437 — 437 
Deconsolidation of noncontrolling interest— — — — — — (11,007)(11,007)
Net loss— — — (61,360)— (61,360)(430)(61,790)
Other comprehensive income (loss)— — — — 11,791 11,791 (11)11,780 
Balance as of March 31, 202217,061,695 $17 $504,934 $(35,807)$(193,393)$275,751 $(4,971)$270,780 
Share-based compensation, net39,426 — 1,128 — — 1,128 — 1,128 
Net loss— — — (33,247)— (33,247)(904)(34,151)
Other comprehensive income (loss)— — — — (16,321)(16,321)277 (16,044)
Balance as of June 30, 202217,101,121 $17 $506,062 $(69,054)$(209,714)$227,311 $(5,598)$221,713 
Share-based compensation, net6,908 — 909 — — 909 — 909 
Net loss— — — (32,686)— (32,686)(534)(33,220)
Other comprehensive income (loss)— — — — (14,489)(14,489)349 (14,140)
Balance as of September 30, 202217,108,029 $17 $506,971 $(101,740)$(224,203)$181,045 $(5,783)$175,262 
 Total Equity
 Common SharesCommon StockAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossCooper-Standard Holdings Inc. EquityNoncontrolling InterestsTotal Equity
Balance as of December 31, 202016,897,085 $17 $498,719 $350,270 $(241,896)$607,110 $17,001 $624,111 
Share-based compensation, net45,467 — 952 — — 952 — 952 
Net loss— — — (33,864)— (33,864)(849)(34,713)
Other comprehensive loss— — — — (4,152)(4,152)(252)(4,404)
Balance as of March 31, 202116,942,552 $17 $499,671 $316,406 $(246,048)$570,046 $15,900 $585,946 
Share-based compensation, net45,962 — 1,677 — — 1,677 — 1,677 
Net loss— — — (63,611)— (63,611)(918)(64,529)
Other comprehensive income— — — — 9,884 9,884 191 10,075 
Balance as of June 30, 202116,988,514 $17 $501,348 $252,795 $(236,164)$517,996 $15,173 $533,169 
Share-based compensation, net2,116 — 1,516 — — 1,516 — 1,516 
Net loss— — — (123,173)— (123,173)(1,691)(124,864)
Other comprehensive loss— — — — (3,144)(3,144)(225)(3,369)
Balance as of September 30, 202116,990,630 $17 $502,864 $129,622 $(239,308)$393,195 $13,257 $406,452 
The accompanying notes are an integral part of these financial statements.
6

COOPER-STANDARD HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollar amounts in thousands)
 Nine Months Ended September 30,
 2017 2016
Operating Activities:   
Net income$109,612
 $108,423
Adjustments to reconcile net income to net cash provided by operating activities:   
Depreciation88,850
 81,725
Amortization of intangibles10,563
 9,974
Impairment charges4,270
 —
Share-based compensation expense19,006
 18,533
Equity in earnings of affiliates, net of dividends related to earnings1,647
 (2,801)
Loss on refinancing and extinguishment of debt1,020
 —
Other14,706
 1,396
Changes in operating assets and liabilities(145,124) (35,205)
Net cash provided by operating activities104,550
 182,045
Investing activities:   
Capital expenditures(137,446) (116,788)
Acquisition of businesses, net of cash acquired(478) (37,478)
Cash from consolidation of joint venture—
 3,395
Proceeds from sale of fixed assets and other1,236
 156
Net cash used in investing activities(136,688) (150,715)
Financing activities:   
Principal payments on long-term debt(15,616) (9,787)
Increase in short-term debt, net6,070
 1,703
Repurchase of common stock(30,680) (23,800)
Proceeds from exercise of warrants836
 2,498
Taxes withheld and paid on employees' share based payment awards(11,949) (11,979)
Other(795) 101
Net cash used in financing activities(52,134) (41,264)
Effects of exchange rate changes on cash and cash equivalents(22,836) (7,880)
Changes in cash and cash equivalents(107,108) (17,814)
Cash and cash equivalents at beginning of period480,092
 378,243
Cash and cash equivalents at end of period$372,984
 $360,429
 Nine Months Ended September 30,
 20222021
Operating Activities:
Net loss$(129,161)$(224,106)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation88,997 99,497 
Amortization of intangibles5,176 5,524 
Gain on sale of business, net— (696)
Gain on sale of fixed assets, net(33,391)— 
Impairment charges837 1,847 
Share-based compensation expense2,593 4,781 
Equity in losses of affiliates, net of dividends related to earnings11,195 2,146 
Deferred income taxes(5,478)9,785 
Other2,383 2,219 
Changes in operating assets and liabilities46,489 (12,485)
Net cash used in operating activities(10,360)(111,488)
Investing activities:
Capital expenditures(58,491)(75,965)
Proceeds from sale of fixed assets52,956 3,095 
Other167 35 
Net cash used in investing activities(5,368)(72,835)
Financing activities:
Principal payments on long-term debt(3,786)(4,227)
Decrease in short-term debt, net(977)(597)
Taxes withheld and paid on employees' share-based payment awards(607)(777)
Other(688)884 
Net cash used in financing activities(6,058)(4,717)
Effects of exchange rate changes on cash, cash equivalents and restricted cash9,296 7,853 
Changes in cash, cash equivalents and restricted cash(12,490)(181,187)
Cash, cash equivalents and restricted cash at beginning of period251,128 443,578 
Cash, cash equivalents and restricted cash at end of period$238,638 $262,391 
Reconciliation of cash, cash equivalents and restricted cash to the condensed consolidated balance sheet:
Balance as of
September 30, 2022December 31, 2021
Cash and cash equivalents$231,177 $248,010 
Restricted cash included in other current assets5,846 961 
Restricted cash included in other assets1,615 2,157 
Total cash, cash equivalents and restricted cash$238,638 $251,128 
The accompanying notes are an integral part of these financial statements.
7
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)



1. Overview
Basis of Presentation
Cooper-Standard Holdings Inc. (together with its consolidated subsidiaries, the “Company” or “Cooper Standard”), through its wholly-owned subsidiary, Cooper-Standard Automotive Inc. (“CSA U.S.”), is a leading manufacturer of sealing, fuel and brake delivery, and fluid transfer and anti-vibration systems. The Company’s products are primarily for use in passenger vehicles and light trucks that are manufactured by global automotive original equipment manufacturers (“OEMs”) and replacement markets. The Company conducts substantially all of its activities through its subsidiaries.
The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) for interim financial information and should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 20162021 (the “2016“2021 Annual Report”), as filed with the SEC. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States (“U.S. GAAP”) for complete financial statements. These financial statements include all adjustments (consisting of normal, recurring adjustments) considered necessary for a fair presentation of the financial position and results of operations of the Company. The operating results for the interim period ended September 30, 20172022 are not necessarily indicative of results for the full year. In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date the financial statements were issued.
Recently Adopted Accounting Pronouncements
2. Deconsolidation and Divestiture
2022 Joint Venture Deconsolidation
In the first quarter of 2017,2022, a joint venture in the Asia Pacific region that was previously consolidated with a noncontrolling interest amended the governing document underlying the joint venture. The amendment to the agreement did not change the Company’s 51% ownership. However, as a result of the amendment and effective as of January 1, 2022, the joint venture was deconsolidated and accounted for as an investment under the equity method. The Company remeasured the retained investment using the income approach method and performed a discounted cash flow analysis of the projected free cash flows of the joint venture. As a result of the deconsolidation, during the nine months ended September 30, 2022, the Company adopted Accounting Standards Updaterecorded a loss of $2,257, included in other income (expense), net in the condensed consolidated statements of operations.
2020 Divestiture
In the fourth quarter of 2019, management approved a plan to sell its European rubber fluid transfer and specialty sealing businesses, as well as its Indian operations. On July 1, 2020, the Company completed the divestiture to Mutares SE & Co. KGaA (“ASU”Mutares”) 2015-11, Inventory (Topic 330): Simplifying. During the Measurementnine months ended September 30, 2021, the Company recorded subsequent adjustments resulting in a net gain of Inventory. This ASU amended$696.
3. Revenue
Revenue is recognized for manufactured parts at a point in time, generally when products are shipped or delivered. The Company usually enters into agreements with customers to produce products at the guidelinesbeginning of a vehicle’s life. Blanket purchase orders received from customers and related documents generally establish the annual terms, including pricing, related to a vehicle model. Customers typically pay for parts based on customary business practices with payment terms generally between 30 and 90 days.
Revenue by customer group for the measurement of inventory from lower of cost or market to the lower of cost and net realizable value. This new guidance has been adopted prospectively and had an immaterial impact on the Company’s consolidated financial statements.three months ended September 30, 2022 was as follows:
Recently Issued Accounting Pronouncements
North AmericaEuropeAsia PacificSouth AmericaCorporate, Eliminations and OtherConsolidated
Passenger and Light Duty$343,012 $108,628 $129,167 $27,069 $— $607,876 
Commercial4,132 4,957 326 4 1,725 11,144 
Other3,867 85 — — 34,181 38,133 
Revenue$351,011 $113,670 $129,493 $27,073 $35,906 $657,153 
In August 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. This guidance eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. This guidance is effective for annual and interim reporting periods beginning after December 15, 2018. Early adoption is permitted. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.
8
In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. This guidance clarifies that modification accounting is required only if there is a change in the fair value, vesting conditions, or classification (as equity or liability) of a share-based payment award due to changes in the terms or conditions. This guidance is effective for annual and interim reporting periods beginning after December 15, 2017. Early adoption is permitted. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.
In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This guidance requires the service cost component of net periodic benefit cost to be recorded in the same income statement line item as other employee compensation costs arising from services rendered during the period. Other components of the net periodic benefit cost must be presented separately outside of operating income. This guidance is effective for annual and interim reporting periods beginning after December 15, 2017. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.
In January 2017, the FASB issued ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This guidance eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. This guidance is effective for annual and interim reporting periods beginning after December 15, 2019. Early adoption is permitted. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.
In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. This guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

Revenue by customer group for the nine months ended September 30, 2022 was as follows:
amounts generally described
North AmericaEuropeAsia PacificSouth AmericaCorporate, Eliminations and OtherConsolidated
Passenger and Light Duty$981,131 $354,689 $317,909 $74,838 $— $1,728,567 
Commercial11,855 16,426 1,114 15 5,047 34,457 
Other11,606 256 2 — 101,166 113,030 
Revenue$1,004,592 $371,371 $319,025 $74,853 $106,213 $1,876,054 
Revenue by customer group for the three months ended September 30, 2021 was as restricted cash or restricted cash equivalents. Therefore, amounts generally describedfollows:
North AmericaEuropeAsia PacificSouth AmericaCorporate, Eliminations and OtherConsolidated
Passenger and Light Duty$262,821 $93,766 $109,187 $15,973 $— $481,747 
Commercial3,341 4,773 337 8 1,333 9,792 
Other4,430 143 2 — 30,576 35,151 
Revenue$270,592 $98,682 $109,526 $15,981 $31,909 $526,690 
Revenue by customer group for the nine months ended September 30, 2021 was as restricted cashfollows:
North AmericaEuropeAsia PacificSouth AmericaCorporate, Eliminations and OtherConsolidated
Passenger and Light Duty$834,545 $380,519 $325,178 $45,597 $— $1,585,839 
Commercial11,027 16,125 2,484 23 4,029 33,688 
Other11,581 435 4 — 97,295 109,315 
Revenue$857,153 $397,079 $327,666 $45,620 $101,324 $1,728,842 
The passenger and restricted cash equivalents should now be included with cashlight duty customer group consists of sales to automotive OEMs and cash equivalents when reconcilingautomotive suppliers, while the beginning-of-periodcommercial customer group represents sales to OEMs of on- and end-of-period total amounts shown on the statement of cash flows. This guidance is effective for annualoff-highway commercial equipment and interim reporting periods beginning after December 15, 2017. Early adoption is permitted.vehicles. The adoption of this ASU is not expectedother customer group includes sales related to have a material impact on the Company’s consolidated statement of cash flows.specialty and adjacent markets.
In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. This guidance will require companies to recognize the income tax effects of intercompany sales and transfers of assets other than inventory in the period in which the transfer occurs. This guidance is effective for annual and interim reporting periods beginning after December 15, 2017, and should be applied on a modified retrospective approach with a cumulative catch-up adjustment to opening retained earnings in the period of adoption. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.
In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The amendments provide guidance on eight specific cash flow issues, thereby reducing diversity in practice. The amendments are effective for annual and interim reporting periods beginning after December 15, 2017. Early adoption is permitted. An entity that elects early adoption must adoptSubstantially all of the amendmentsCompany’s revenues were generated from sealing, fuel and brake delivery and fluid transfer systems for use in the same period. The guidance requires companies to use a retrospective transition method upon adoption. The Company’s current accounting practices are consistent with the issues addressedpassenger vehicles and light trucks manufactured by this guidance. Therefore, this guidance is not expected to have a material impact onglobal OEMs.
A summary of the Company’s consolidated financial statements.products is as follows:
In February 2016,
Product LineDescription
Sealing SystemsProtect vehicle interiors from weather, dust and noise intrusion for improved driving experience; provide aesthetic and functional class-A exterior surface treatment
Fuel & Brake Delivery SystemsSense, deliver and control fluids to fuel and brake systems
Fluid Transfer SystemsSense, deliver and control fluids and vapors for optimal powertrain & HVAC operation
Revenue by product line for the FASB issued ASU 2016-02, Leases (Topic 842). The guidance revises existing U.S. GAAP by requiring lessees to recognize right-of-use assets and lease liabilities for all leases (except for short-term leases). The standard also requires additional disclosures to help financial statement users better understand the amount, timing and uncertainty of cash flows arising from lease transactions. This guidance is effective for annual and interim reporting periods beginning after December 15, 2018. A modified retrospective transition approach is required with certain practical expedients available. The Company continues to perform a comprehensive evaluation on the impacts of adopting this standard and plans on adopting this ASU effective January 1, 2019. The Company believes this standard will primarily result in an increase in the assets and liabilities on its consolidated balance sheet and will not have a material impact on its consolidated income statement.three months ended September 30, 2022 was as follows:
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The guidance prescribes a single, common revenue standard that replaces most existing revenue recognition guidance in U.S. GAAP. The standard outlines a five-step model whereby revenue is recognized as performance obligations within a contract are satisfied. The standard also requires new, expanded revenue disclosures.
North AmericaEuropeAsia PacificSouth AmericaCorporate, Eliminations and OtherConsolidated
Sealing systems$133,347 $91,078 $85,309 $21,654 $— $331,388 
Fuel and brake delivery systems113,755 19,572 27,540 3,715 — 164,582 
Fluid transfer systems103,909 3,020 16,644 1,704 — 125,277 
Other— — — — 35,906 35,906 
Revenue$351,011 $113,670 $129,493 $27,073 $35,906 $657,153 
Several ASUs addressing revenue recognition have been issued since the issuance of ASU 2014-09. These ASUs, which modify certain sections of ASU 2014-09, are intended to promote a more consistent interpretation and application of the principles outlined in the standard. The Company will adopt the guidance effective January 1, 2018, the standard’s effective date, using the modified retrospective method. Under this method, the cumulative effect of adopting the standard is recognized in equity at the date of initial application.
9
To assess the impact of the new standard, the Company developed a comprehensive project plan. This project plan includes analyzing the standard’s impact on customer contracts across the Company’s business segments, comparing its historical accounting policies and practices to the requirements of the new standard, and identifying potential differences from applying the new standard’s requirements. The Company has substantially completed its assessment and does not expect that adopting the new standard will have a material impact on its consolidated financial statements. As a result, it expects to recognize substantially all of its revenue at a point in time, generally when products are either shipped or delivered. The Company will finalize its evaluation of the effect on its consolidated financial statements during the fourth quarter of 2017.
The Company has completed its evaluation of pre-production costs related to long-term supply arrangements, such as reimbursable tooling, and expects to continue accounting for pre-production costs in accordance with existing guidance. In addition, the Company’s internal control framework is not expected to significantly change. Instead, existing internal controls will be modified and augmented, as necessary. While implementing the new standard, the Company will continue to monitor FASB activities and interpretations of various non-authoritative industry groups for any possible impact on the Company’s findings.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

Revenue by product line for the nine months ended September 30, 2022 was as follows:
2. Acquisitions
North AmericaEuropeAsia PacificSouth AmericaCorporate, Eliminations and OtherConsolidated
Sealing systems$388,244 $298,163 $198,219 $56,999 $— $941,625 
Fuel and brake delivery systems324,090 64,248 71,768 12,090 — 472,196 
Fluid transfer systems292,258 8,960 49,038 5,764 — 356,020 
Other— — — — 106,213 106,213 
Revenue$1,004,592 $371,371 $319,025 $74,853 $106,213 $1,876,054 
AMI AcquisitionRevenue by product line for the three months ended September 30, 2021 was as follows:
In 2016,
North AmericaEuropeAsia PacificSouth AmericaCorporate, Eliminations and OtherConsolidated
Sealing systems$102,636 $75,824 $69,872 $12,114 $— $260,446 
Fuel and brake delivery systems80,549 18,989 23,446 2,286 — 125,270 
Fluid transfer systems87,407 3,869 16,208 1,581 — 109,065 
Other— — — — 31,909 31,909 
Revenue$270,592 $98,682 $109,526 $15,981 $31,909 $526,690 
Revenue by product line for the nine months ended September 30, 2021 was as follows:
North AmericaEuropeAsia PacificSouth AmericaCorporate, Eliminations and OtherConsolidated
Sealing systems$313,985 $310,063 $201,873 $34,921 $— $860,842 
Fuel and brake delivery systems275,594 73,770 76,981 7,299 — 433,644 
Fluid transfer systems267,574 13,246 48,812 3,400 — 333,032 
Other— — — — 101,324 101,324 
Revenue$857,153 $397,079 $327,666 $45,620 $101,324 $1,728,842 
Contract Estimates
The amount of revenue recognized is usually based on the purchase order price and adjusted for variable consideration, including pricing concessions. The Company acquiredaccrues for pricing concessions by reducing revenue as products are shipped or delivered. The accruals are based on historical experience, anticipated performance and management’s best judgment. The Company also generally has ongoing adjustments to customer pricing arrangements based on the North American fuelcontent and brake businesscost of AMI Industries (the “AMI Business”) for cash consideration of $32,000 (the “AMI Acquisition”). This acquisition directly alignsits products. Such pricing accruals are adjusted as they are settled with the Company’s growth strategy by expanding the Company’s fuelcustomers. Customer returns, which are infrequent, are usually related to quality or shipment issues and brake business. The results of operations of the AMI Business are included in the Company’s condensed consolidated financial statements from the date of acquisition, August 15, 2016, and reported within the North America segment. This acquisition was accounted forrecorded as a business combination, resulting in the recognitionreduction of intangible assets of $19,410 and goodwill of $7,175 in 2016. In the second quarter of 2017, the Company agreed to purchase the China fuel and brake business of AMI Industries, which is subject to regulatory approval.
Other Acquisitions
In 2016, the Company acquired a business in furtherance of the Company’s China operations. The total purchase price of the acquisition was $5,478, of which $3,020 was paid during the first quarter of 2016 and $2,458 was paid in the third quarter of 2016.revenue. The Company recognized $2,972generally does not recognize significant return obligations due to their infrequent nature.
Contract Balances
The Company’s contract assets consist of goodwillunbilled amounts associated with variable pricing arrangements in 2016 as a result of this acquisition.
Also in 2016, the Company obtained control of its 51%-owned joint venture, Shenya Sealing (Guangzhou) Company Limited (“Guangzhou”) through an amendment of the joint venture governing document. This joint venture was previously accounted for as an investment under the equity method. The results of operations of Guangzhou are included in the Company’s consolidated financial statements from the date of consolidation, August 4, 2016, and reported within the Asia Pacific segment. Business combination accounting was completed, resultingregion. Once pricing is finalized, contract assets are transferred to accounts receivable. As a result, the timing of revenue recognition and billings, as well as changes in foreign exchange rates, will impact contract assets on an ongoing basis. Contract assets were not materially impacted by any other factors during the recognitionnine months ended September 30, 2022.
The Company’s contract liabilities consist of intangibleadvance payments received and due from customers. Net contract assets (liabilities) consisted of $6,605the following:
September 30, 2022December 31, 2021Change
Contract assets$3,690 $— $3,690 
Contract liabilities(13)(143)130 
Net contract assets (liabilities)$3,677 $(143)$3,820 
10
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and goodwillshare amounts)
Other
The Company, at times, enters into agreements that provide for lump sum payments to customers. These payment agreements are recorded as a reduction of $9,741 in 2016. There was no gain or loss recognizedrevenue during the period the commitment is made. Amounts related to commitments of future payments to customers on the remeasurementcondensed consolidated balance sheets as of September 30, 2022 and December 31, 2021 were current liabilities of $13,968 and $12,045, respectively, and long-term liabilities of $5,733 and $7,214, respectively.
The Company provides assurance-type warranties to its customers. Such warranties provide customers with assurance that the Company’s equity method investmentrelated product will function as intended and complies with any agreed-upon specifications, and are recognized in Guangzhou.costs of products sold.
3.4. Restructuring
On an ongoing basis, the Company evaluates its business and objectives to ensure that it is properly configured and sized based on changing market conditions. Accordingly, the Company has implemented several restructuring initiatives, including closure or consolidation of facilities throughout the world and the reorganization of its operating structure.
In January 2015, the Company announced its intention to further restructure its European manufacturing footprint based on anticipated market demands. The total estimated cost of this initiative, which is expected to be substantially completed by the end of 2017, is approximately $120,000 to $125,000, of which approximately $107,000 has been incurred to date. We expect to incur total employee separation costs of approximately $63,000 to $66,000, other related exit costs of approximately $56,000 to $58,000 and non-cash asset impairments related to restructuring activities of approximately $500.
The Company’s restructuring charges consist of severance, retention and outplacement services, and severance-related postemployment benefits (collectively, “employee separation costs”), along with other related exit costs and asset impairments related to restructuring activities.activities (collectively, “other exit costs”). Employee separation costs are recorded based on existing union and employee contracts, statutory requirements, completed negotiations and Company policy.
Restructuring expense by segment for the three and nine months ended September 30, 20172022 and 20162021 was as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
North America$(66)$307 $(152)$3,513 
Europe1,383 1,113 11,518 27,284 
Asia Pacific319 282 1,318 1,265 
South America147 (129)252 1,858 
Total Automotive1,783 1,573 12,936 33,920 
Corporate and other(82)— 78 331 
Total$1,701 $1,573 $13,014 $34,251 
Restructuring activity for the nine months ended September 30, 2022 was as follows:
Employee Separation CostsOther Exit CostsTotal
Balance as of December 31, 2021$20,957 $5,627 $26,584 
Expense8,654 4,360 13,014 
Cash payments(15,361)(2,455)(17,816)
Foreign exchange translation and other(2,074)(517)(2,591)
Balance as of September 30, 2022$12,176 $7,015 $19,191 
Other exit costs for the nine months ended September 30, 2022 included an immaterial gain on sale of fixed assets related to a closed facility in the Asia Pacific region.
5. Inventories
Inventories consist of the following:
September 30, 2022December 31, 2021
Finished goods$52,462 $43,186 
Work in process47,136 37,045 
Raw materials and supplies95,405 77,844 
$195,003 $158,075 
11
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
North America$2,503
 $306
 $3,320
 $1,661
Europe6,236
 9,691
 22,341
 30,184
Asia Pacific1,170
 433
 2,559
 1,623
Total$9,909
 $10,430
 $28,220
 $33,468
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

6. Leases
Restructuring activityThe Company primarily has operating and finance leases for certain manufacturing facilities, corporate offices and certain equipment. Operating leases are included in operating lease right-of-use assets, current operating lease liabilities and long-term operating lease liabilities on the nine months ended September 30, 2017Company’s condensed consolidated balance sheets. Finance leases are included in property, plant and equipment, net, debt payable within one year, and long-term debt on the Company’s condensed consolidated balance sheets.
The components of lease expense were as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Operating lease expense$6,954 $7,827 $21,578 $23,258 
Short-term lease expense1,413 1,719 3,558 5,324 
Variable lease expense326 191 792 620 
Finance lease expense:
Amortization of right-of-use assets523 519 1,500 1,586 
Interest on lease liabilities318 356 980 1,094 
Total lease expense$9,534 $10,612 $28,408 $31,882 
Other information related to leases was as follows:
Nine Months Ended September 30,
20222021
Supplemental Cash Flows Information
Cash paid for amounts included in the measurement of lease liabilities:
     Operating cash flows for operating leases$21,944 $25,641 
     Operating cash flows for finance leases988 1,093 
     Financing cash flows for finance leases1,488 1,677 
Non-cash right-of-use assets obtained in exchange for lease obligations:
     Operating leases11,012 14,968 
     Finance leases128 606 
Weighted Average Remaining Lease Term (in years)
Operating leases7.47.6
Finance leases9.19.9
Weighted Average Discount Rate
Operating leases6.1 %5.7 %
Finance leases5.9 %5.8 %
12
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)
 Employee Separation Costs Other Exit Costs Total
Balance as of December 31, 2016$21,927
 $2,311
 $24,238
Expense14,991
 13,229
 28,220
Cash payments(22,224) (11,811) (34,035)
Foreign exchange translation and other1,769
 450
 2,219
Balance as of September 30, 2017$16,463
 $4,179
 $20,642
Future minimum lease payments under non-cancellable leases as of September 30, 2022 were as follows:
YearOperating LeasesFinance
Leases
Remainder of 2022$6,567 $756 
202324,425 3,059 
202418,619 3,250 
202515,136 3,274 
202611,060 3,033 
Thereafter48,714 16,396 
    Total future minimum lease payments124,521 29,768 
Less imputed interest(25,127)(7,015)
    Total$99,394 $22,753 
4. InventoriesAmounts recognized on the condensed consolidated balance sheets as of September 30, 2022 and December 31, 2021 were as follows:
Inventories consist
September 30, 2022December 31, 2021
Operating Leases
Operating lease right-of-use assets, net$95,803 $111,052 
Current operating lease liabilities20,172 22,552 
Long-term operating lease liabilities79,222 92,760 
Finance Leases
Property, plant and equipment, net22,260 25,690 
Debt payable within one year2,067 2,153 
Long-term debt20,686 23,590 

As of September 30, 2022, the following:Company had additional leases, primarily for real estate, that had not yet commenced with undiscounted lease payments of approximately $3,163.
 September 30, 2017 December 31, 2016
Finished goods$48,596
 $43,511
Work in process39,499
 32,839
Raw materials and supplies91,375
 70,099
 $179,470
 $146,449
5.7. Property, Plant and Equipment
Property, plant and equipment consists of the following:
September 30, 2022December 31, 2021
Land and improvements$40,889 $44,495 
Buildings and improvements253,181 285,240 
Machinery and equipment1,198,754 1,269,330 
Construction in progress79,252 80,868 
1,572,076 1,679,933 
Accumulated depreciation(904,959)(895,585)
Property, plant and equipment, net$667,117 $784,348 
 September 30, 2017 December 31, 2016
Land and improvements$72,737
 $71,002
Buildings and improvements293,257
 265,824
Machinery and equipment998,643
 864,337
Construction in progress184,991
 153,924
 1,549,628
 1,355,087
Accumulated depreciation(633,132) (522,818)
Property, plant and equipment, net$916,496
 $832,269
Impairment of Long-Lived Assets
Due toDuring the Company’s decision to divest two of its inactive European sites,three and nine months ended September 30, 2022, the Company recorded impairment charges of $4,270$379 and $837, respectively, primarily due to idle assets in Europe and North America. The fair value was determined using salvage value. During the three and nine months ended September 30, 2021, the Company recorded impairment charges of $1,006 and $1,847, respectively, due to idle assets, primarily in certain North American and European locations. The fair value was determined using salvage value.
The deconsolidation of a joint venture during the three months ended March 31, 2022 included the removal of property, plant and equipment with gross carrying value of $29,590 and accumulated depreciation of $11,625, which is reflected in the balance sheet as of September 30, 2022.
13
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)
In the first quarter of 2022, the Company closed on a sale-leaseback transaction related to one of its European facilities. The sale-leaseback was effective and control transferred to the Company on April 1, 2022. During the nine months ended September 30, 2017. Fair2022, the Company recorded a gain on the sale transaction of $33,391. The transaction included the removal of property, plant and equipment with a gross carrying value was determined based on current real estate market conditions.of $16,890 and accumulated depreciation of $4,013, which is reflected in the balance sheet as of September 30, 2022.
6.8. Goodwill and Intangible Assets
Goodwill
Changes in the carrying amount of goodwill by reportable operating segmentreporting unit for the nine months ended September 30, 20172022 were as follows:
 North America Europe Asia Pacific Total
Balance as of December 31, 2016$121,996
 $10,753
 $34,692
 $167,441
Acquisition—
 236
 —
 236
Foreign exchange translation240
 1,259
 1,589
 3,088
Balance as of September 30, 2017$122,236
 $12,248
 $36,281
 $170,765
North AmericaIndustrial Specialty GroupTotal
Balance as of December 31, 2021$128,246 $14,036 $142,282 
Foreign exchange translation(324)— (324)
Balance as of September 30, 2022$127,922 $14,036 $141,958 
Goodwill is tested for impairment by reporting unit annually or more frequently if events or circumstances indicate that an impairment may exist. There were no indicators of potential impairment during the nine months ended September 30, 2017.2022.
Intangible Assets
Intangible assets and accumulated amortization balances as of September 30, 2022 and December 31, 2021 were as follows:
Gross
Carrying
Amount		Accumulated
Amortization		Net
Carrying
Amount
Customer relationships$152,210 $(128,099)$24,111 
Other37,662 (13,360)24,302 
Balance as of September 30, 2022$189,872 $(141,459)$48,413 
Customer relationships$154,767 $(126,626)$28,141 
Other44,955 (12,721)32,234 
Balance as of December 31, 2021$199,722 $(139,347)$60,375 
The deconsolidation of a joint venture in the first quarter of 2022 included the removal of intangible assets (primarily land use rights) with net carrying value of $5,258, which is reflected in the table above as of September 30, 2022.
14
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

Intangible Assets
Intangible assets and accumulated amortization balances as of September 30, 2017 and December 31, 2016 were as follows:
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Amount
Customer relationships$135,680
 $(83,044) $52,636
Developed technology9,144
 (9,053) 91
Other21,863
 (2,530) 19,333
Balance as of September 30, 2017$166,687
 $(94,627) $72,060
      
Customer relationships$134,918
 $(73,088) $61,830
Developed technology8,762
 (8,386) 376
Other20,965
 (1,808) 19,157
Balance as of December 31, 2016$164,645
 $(83,282) $81,363
7.9. Debt
A summary of outstanding debt as of September 30, 20172022 and December 31, 2016 was2021 is as follows:
September 30, 2017 December 31, 2016September 30, 2022December 31, 2021
Senior Notes$393,505
 $393,060
Senior Notes$397,080 $396,544 
Senior Secured NotesSenior Secured Notes243,700 241,683 
Term Loan331,382
 332,827
Term Loan319,393 321,212 
Finance leasesFinance leases22,753 25,743 
Other borrowings30,118
 37,032
Other borrowings44,399 51,533 
Total debt755,005
 762,919
Total debt1,027,325 1,036,715 
Less current portion(32,448) (33,439)Less current portion(48,890)(56,111)
Total long-term debt$722,557
 $729,480
Total long-term debt$978,435 $980,604 
5.625% Senior Notes due 2026
In November 2016, the Company issued $400,000 aggregate principal amount of its 5.625% Senior Notes due 2026 (the “Senior Notes”). The Senior Notes mature on November 15, 2026. Interest on the Senior Notes is payable semi-annually in arrears in cash on May 15 and November 15 of each year, commencing on May 15, 2017.year.
Debt issuance costs related to the Senior Notes are amortized into interest expense over the term of the Senior Notes. As of September 30, 20172022 and December 31, 2016,2021, the Company has $6,495had $2,920 and $6,940$3,456 of unamortized debt issuance costs, respectively, related to the Senior Notes, which are presented as direct deductions from the principal balance in the condensed consolidated balance sheets.
13.0% Senior Secured Notes due 2024
In May 2020, the Company issued $250,000 aggregate principal amount of its 13.0% Senior Secured Notes due 2024 (the “Senior Secured Notes”). The Senior Secured Notes mature on June 1, 2024. Interest on the Senior Secured Notes is payable semi-annually in arrears in cash on June 1 and December 1 of each year. The Company may redeem all or part of the Senior Secured Notes prior to maturity at the prices (inclusive of any applicable premium) set forth in the indenture.
The Company paid approximately $6,431 of debt issuance costs in connection with the transaction. Additionally, the Senior Secured Notes were issued at a discount of $5,000. As of September 30, 2022 and December 31, 2021, the Company had $3,452 and $4,594 of unamortized debt issuance costs, respectively, and $2,848 and $3,723 of unamortized original issue discount, respectively, related to the Senior Secured Notes, which are presented as direct deductions from the principal balance in the condensed consolidated balance sheets. Both the debt issuance costs and the original issue discount are amortized into interest expense over the term of the Senior Secured Notes.
Term Loan Facility
Also in
In November 2016, the Company entered into Amendment No. 1 to its senior term loan facility (“Term Loan Facility”), which provides for loans in an aggregate principal amount of $340,000. Subject to certain conditions, the Term Loan Facility, without the consent of the then-existing lenders (but subject to the receipt of commitments), may be expanded (or a new term loan or revolving facility added) by an amount that will not cause the consolidated secured net debt ratio to exceed 2.25 to 1.00 plus $400,000 plus any voluntary prepayments, including the senior asset-based revolving credit facility (“ABL Facility”) to the extent commitments are reduced, not funded from proceeds of long-term indebtedness. The Term Loan Facility matures on November 2, 2023, unless earlier terminated.
On May 2, 2017, the Company entered into Amendment No. 2 to the Term Loan Facility to modify the interest rate. Subsequently, on March 6, 2018, the Company entered into Amendment No. 3 to the Term Loan Facility to further modify the interest rate. In accordance with this amendment, borrowings under the Term Loan Facility bear interest, at the Company’s option, at either (1) with respect to Eurodollar rate loans, the greater of the applicable Eurodollar rate and 0.75%, plus 2.25%2.0% per annum, or (2) with respect to base rate loans, the base rate, (which is the highest of the then-currentthen current federal funds rate plus 0.5%, the prime rate most recently announced by the administrative agent under the term loan, and the one-month Eurodollar rate plus 1.0%), plus 1.25%1.0% per annum. AsThe Term Loan Facility matures on November 2, 2023, unless earlier terminated. The Company has retained Goldman Sachs & Co. LLC as its financial advisor to analyze, evaluate and help arrange a resultrefinancing of the amendment,Term Loan Facility and possibly certain other debt instruments. The Company’s ability to continue as a going concern is contingent upon its ability to refinance its Term Loan Facility. The Company continues its discussions with certain investors with respect to potential refinancing alternatives. While discussions are ongoing, the Company recognizedhas not reached an agreement with respect to such a loss ontransaction for refinancing its capital structure and extinguishment of
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

debt of $1,020there can be no assurances that such an agreement will be reached in the second quarter of 2017, which was due to the partial write off of new and unamortized debt issuance costs and unamortized original issue discount.future.
As of September 30, 20172022 and December 31, 2016,2021, the Company had $3,689$642 and $4,352$1,087 of unamortized debt issuance costs, respectively, and $2,379$414 and $2,821$701 of unamortized original issue discount, respectively, related to the Term Loan Facility, which are presented as direct deductions from the principal balance in the condensed consolidated balance sheets. Both the debt issuance costs and the original issue discount are amortized into interest expense over the term of the Term Loan Facility.
15
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)
ABL Facility
In November 2016, the Company entered into a $210,000 Third Amended and Restated Loan Agreement of its senior asset-based revolving credit facility (“ABL Facility”).
The ABL Facility, provides forwhich provided an aggregate revolving loan availability of up to $210,000, subject to borrowing base availability. In March 2020, the Company entered into the First Amendment of the Third Amended and Restated Loan Agreement (“the Amendment”). As a result of the Amendment, the senior asset-based revolving credit facility (“ABL Facility”) maturity was extended to March 2025 and the aggregate revolving loan availability includingwas reduced to $180,000. The aggregate revolving loan availability includes a $100,000 letter of credit sub-facility and a $25,000 swing line sub-facility. The ABL Facility also provides for an uncommitted $100,000 incremental loan facility, for a potential total ABL Facility of $310,000,$280,000, if requested by the borrowers under the ABL Facility and the lenders agree to fund such increase. No consent of any lender is required to effect any such increase, except for those participating in the increase.
As of September 30, 2017,2022, there were no borrowingsloans outstanding under the ABL Facility, and subject toFacility. The Company’s borrowing base availability,was $180,000. Net of the Company had $197,074 in availability, lessgreater of 10% of the borrowing base or $15,000 that cannot be borrowed without triggering the fixed charge coverage ratio maintenance covenant and $6,310 of outstanding letters of credit, of $8,542.the Company effectively had $155,690 available for borrowing under its ABL facility.
Any borrowings under ourthe ABL Facility will mature, and the commitments of the lenders under ourthe ABL Facility will terminate, on November 2, 2021.the earlier of March 24, 2025 or the date 91 days prior to the maturity date of the Term Loan Facility (or another fixed asset facility replacing the Term Loan Facility).
As of September 30, 20172022 and December 31, 2016,2021, the Company had $1,440$597 and $1,706,$782, respectively, of unamortized debt issuance costs related to the ABL Facility, which are presented in other assets in the condensed consolidated balance sheets.
Debt Covenants
The Company was in compliance with all covenants of the Senior Notes, Senior Secured Notes, Term Loan Facility and ABL Facility as of September 30, 2017.2022.
Other
Other borrowings as of September 30, 2022 and December 31, 2021 reflect borrowings under capital leases, local bank lines and accounts receivable factoring sold with recourse classified in debt payable within one year on the condensed consolidated balance sheets.sheet.
8.10. Fair Value Measurements and Financial Instruments
Fair Value Measurements
Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based upon assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a three-tier fair value hierarchy is utilized, which prioritizes the inputs used in measuring fair value as follows:
Level 1:Observable inputs such as quoted prices in active markets;
Level 2:Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and
Level 3:Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

Items Measured at Fair Value on a Recurring Basis
Estimates of the fair value of foreign currency and interest rate derivative instruments are determined using exchange traded prices and rates. The Company also considers the risk of non-performance in the estimation of fair value and includes an adjustment for non-performance risk in the measure of fair value of derivative instruments. In certain instances where market data is not available, the Company uses management judgment to develop assumptions that are used to determine fair value. Fair value measurements and the fair value hierarchy level for the Company’s assets and liabilities measured or disclosed at fair value on a recurring basis as of September 30, 20172022 and December 31, 2016 was2021 were as follows:
September 30, 2022December 31, 2021Input
Forward foreign exchange contracts - other current assets$3,624 $647 Level 2
Forward foreign exchange contracts - accrued liabilities(487)(1,535)Level 2
16
 September 30, 2017 December 31, 2016 Input
Forward foreign exchange contracts - other current assets$888
 $764
 Level 2
Forward foreign exchange contracts - accrued liabilities(1,140) (535) Level 2
Interest rate swaps - accrued liabilities(1,090) (2,458) Level 2
Interest rate swaps - other liabilities—
 (661) Level 2
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)
Items Measured at Fair Value on a Nonrecurring Basis
In addition to items that are measured at fair value on a recurring basis, the Company measures certain assets and liabilities at fair value on a nonrecurring basis, which are not included in the table above. As these nonrecurring fair value measurements are generally determined using unobservable inputs, these fair value measurements are classified within Level 3 of the fair value hierarchy. For further information on assets and liabilities measured at fair value on a nonrecurring basis see Note 2. “Acquisitions,” Note 3. “Restructuring”“Deconsolidation and Divestiture” and Note 5.7. “Property, Plant and Equipment.”
Items Not Carried Atat Fair Value
Fair values of the Company’s debt instrumentsSenior Notes, Senior Secured Notes and Term Loan Facility were as follows:
September 30, 2022December 31, 2021
Aggregate fair value$719,807 $899,909 
Aggregate carrying value (1)
970,450 973,000 
 September 30, 2017 December 31, 2016
Aggregate fair value$746,746
 $735,850
Aggregate carrying value (1)
737,450
 740,000
(1) Excludes unamortized debt issuance costs and unamortized original issue discount.
Fair values were based on quoted market prices and are classified within Level 1 of the fair value hierarchy.
Derivative Instruments and Hedging Activities
The Company is exposed to fluctuations in foreign currency exchange rates, interest rates and commodity prices. The Company enters into derivative instruments primarily to hedge portions of its forecasted foreign currency denominated cash flows and designates these derivative instruments as cash flow hedges in order to qualify for hedge accounting. Gains or losses on derivative instruments resulting from hedge ineffectiveness are reported in earnings.
The Company formally documents its hedge relationships, including the identification of the hedging instruments and the hedged items, as well as its risk management objectives and strategies for undertaking the cash flow hedges. The Company also formally assesses whether a cash flow hedge is highly effective in offsetting changes in the cash flows of the hedged item. Derivatives are recorded at fair value in other current assets, other assets, accrued liabilities and other long-term liabilities. For a cash flow hedge, the effective portion of the change in fair value of the derivative is recorded in accumulated other comprehensive income (loss) (“AOCI”) in the condensed consolidated balance sheet, to the extent that the hedges are effective, and reclassified into earnings when the underlying hedged transaction is realized. The realized gains and losses are recorded on the same line as the hedged transaction in the condensed consolidated statements of net income.operations.
The Company is exposed to credit risk in the event of nonperformance by its counterparties on its derivative financial instruments. The Company mitigates this credit risk exposure by entering into agreements directly with major financial institutions with high credit standards that are expected to fully satisfy their obligations under the contracts.
Cash Flow Hedges
Forward Foreign Exchange Contracts— - The Company uses forward contracts to mitigate the potential volatility to earnings and cash flowflows arising from changes in currency exchange rates that impact the Company’s foreign currency transactions. The principal currencies hedged by the Company include various European currencies, the Canadian Dollar, and the Mexican Peso,Peso. As of September 30, 2022 and December 31, 2021, the notional amount of these contracts was $155,054 and $136,103, respectively, and consisted of hedges of transactions up to December 2023.
Pretax amounts related to the Company’s cash flow hedges that were recognized in other comprehensive income (loss) (“OCI”) were as follows:
Gain (Loss) Recognized in OCI
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Forward foreign exchange contracts$3,168 $(1,606)$5,064 $(964)
Pretax amounts related to the Company’s cash flow hedges that were reclassified from AOCI and recognized in cost of products sold were as follows:
Gain (Loss) Reclassified from AOCI to Income
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Forward foreign exchange contracts$486 $508 $1,048 $1,045 
17
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

the Brazilian Real. As of September 30, 2017, the notional amount of these contracts was $107,053 and consisted of hedges of transactions up to September 2018.
Interest rate swaps - The Company uses interest rate swap transactions to manage cash flow variability associated with its variable rate Term Loan Facility. The interest rate swap contracts, which fix the interest payments of variable rate debt instruments, are used to manage exposure to fluctuations in interest rates. As of September 30, 2017, the notional amount of these contracts was $150,000, with maturities through September 2018. The fair market value of all outstanding interest rate swap contracts is subject to change due to fluctuations in interest rates.
Pretax amounts related to the Company’s cash flow hedges that were recognized in AOCI were as follows:
 Gain (Loss) Recognized in AOCI
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Forward foreign exchange contracts$(763) $854
 $1,860
 $(3,384)
Interest rate swaps22
 131
 (27) (2,123)
Total$(741) $985
 $1,833
 $(5,507)
Pretax amounts related to the Company’s cash flow hedges that were reclassified from AOCI were as follows:
   Gain (Loss) Reclassified from AOCI to Income (Effective Portion) Gain (Loss) Reclassified from AOCI to Income (Ineffective Portion)
   Three Months Ended September 30,
 Classification 2017 2016 2017 2016
Forward foreign exchange contractsCost of products sold $915
 $(769) $—
 $—
Interest rate swapsInterest expense, net of interest income (570) (803) 107
 —
Total  $345
 $(1,572) $107
 $—
   Gain (Loss) Reclassified from AOCI to Income (Effective Portion) Gain (Loss) Reclassified from AOCI to Income (Ineffective Portion)
   Nine Months Ended September 30,
 Classification
 2017 2016 2017 2016
Forward foreign exchange contractsCost of products sold $2,371
 $(2,380) $—
 $—
Interest rate swapsInterest expense, net of interest income (2,048) (2,393) 284
 —
Total  $323
 $(4,773) $284
 $—
The amount of losses to be reclassified from AOCI into income in the next twelve months related to the interest rate swap is expected to be approximately $1,090.
9.11. Accounts Receivable Factoring
As a part of its working capital management, the Company sells certain receivables through third partya single third-party financial institutions with and without recourse.institution (the “Factor”) in a pan-European program. The amount sold varies each month based on the amount of underlying receivables and cash flow needs of the Company. The Company continues to service the receivables. These are permitted transactions under the Company’s credit agreementagreements governing the ABL Facility theand Term Loan Facility and the indentures governing the Senior Notes and Senior Secured Notes. The European factoring facility, which was renewed in March 2020, allows the Company to factor up to €120 million of its Euro-denominated accounts receivable, accelerating access to cash and reducing credit risk. The factoring facility expires in December 2023.
Costs incurred on the sale of receivables are recorded in other expense, net and interest expense, net of interest income in the condensed consolidated statements of net income. Receivables sold with recourse areoperations. The sale of receivables under this contract is considered an off-balance sheet arrangement to the Company and is accounted for as secured borrowingsa true sale and are recorded in debt payable within one year, and receivables are pledged equal to the balance of the borrowings. Receivables sold without recourse are accounted for as true sales and areis excluded from accounts receivable in the condensed consolidated balance sheet. Amounts outstanding under receivable transfer agreements entered into by various locations as of the period end were as follows:
September 30, 2022December 31, 2021
Off-balance sheet arrangements$49,155 $52,743 
Accounts receivable factored and related costs throughout the period were as follows:
Off-Balance Sheet Arrangements
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Accounts receivable factored$89,263 $68,897 $262,145 $286,214 
Costs156 117 395 421 
As of September 30, 2022 and December 31, 2021, cash collections on behalf of the Factor that have yet to be remitted were $5,216 and $673, respectively, and are reflected in other current assets as restricted cash in the condensed consolidated balance sheet.
18
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

Amounts outstanding under receivable transfer agreements entered into by various locations were as follows:
 September 30, 2017 December 31, 2016
Without recourse$62,594
 $56,936
With recourse5,018
 5,258
Accounts receivable factored and related costs were as follows:
 Without Recourse With Recourse
 Three Months Ended September 30, Nine Months Ended September 30, Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016 2017 2016 2017 2016
Accounts receivable factored$98,244
 $120,220
 $390,354
 $381,190
 $6,326
 $7,550
 $20,432
 $18,078
Costs452
 391
 1,517
 1,286
 29
 55
 74
 185
Repurchase of accounts receivable
During the three months ended September 30, 2017, the Company repurchased $12,043 of its accounts receivable in Europe that were previously sold to certain third party financial institutions through receivable purchase agreements. In addition, the Company repurchased $19,378 of its receivables in Europe in October 2017. The repurchases were made as part of the Company’s transition to a pan-European program under a single third party financial institution, which is expected to be completed in the fourth quarter of 2017.
10.12. Pension and Postretirement Benefits Other Than Pensions

The components of net periodic benefit (income) cost for the three and nine months ended September 30, 2017 and 2016 for the Company’s defined benefit plans and other postretirement benefit plans were as follows:
 Pension Benefits Pension Benefits
Three Months Ended September 30,Three Months Ended September 30,
2017 201620222021
 U.S.  Non-U.S.  U.S.  Non-U.S. U.S. Non-U.S. U.S. Non-U.S.
Service cost$204
 $1,018
 $202
 $861
Service cost$193 $658 $223 $878 
Interest cost2,925
 1,140
 3,145
 1,267
Interest cost1,766 690 1,629 659 
Expected return on plan assets(4,003) (694) (3,959) (788)Expected return on plan assets(2,323)(247)(3,564)(335)
Amortization of prior service cost and actuarial loss468
 760
 429
 555
Amortization of prior service cost and actuarial loss222 376 418 509 
Settlement—
 5,717
 —
 —
OtherOther— — — — 
Net periodic benefit (income) cost$(406) $7,941
 $(183) $1,895
Net periodic benefit (income) cost$(142)$1,477 $(1,294)$1,711 
       
 Pension Benefits Pension Benefits
Nine Months Ended September 30,Nine Months Ended September 30,
2017 201620222021
 U.S.  Non-U.S.  U.S.  Non-U.S. U.S. Non-U.S. U.S. Non-U.S.
Service cost$612
 $2,926
 $606
 $2,575
Service cost$579 $2,071 $669 $2,705 
Interest cost8,775
 3,268
 9,435
 3,805
Interest cost5,298 2,139 4,887 1,967 
Expected return on plan assets(12,009) (2,001) (11,877) (2,367)Expected return on plan assets(6,969)(753)(10,692)(1,013)
Amortization of prior service cost and actuarial loss1,404
 2,171
 1,287
 1,664
Amortization of prior service cost and actuarial loss666 1,187 1,254 2,374 
Settlement—
 5,717
 —
 —
OtherOther— — — 125 
Net periodic benefit (income) cost$(1,218) $12,081
 $(549) $5,677
Net periodic benefit (income) cost$(426)$4,644 $(3,882)$6,158 
 
 Other Postretirement Benefits
Three Months Ended September 30,
20222021
 U.S. Non-U.S. U.S. Non-U.S.
Service cost$22 $56 $26 $91 
Interest cost140 163 133 178 
Amortization of prior service credit and actuarial (gain) loss(394)41 (349)191 
Net periodic benefit (income) cost$(232)$260 $(190)$460 
Other Postretirement Benefits
Nine Months Ended September 30,
20222021
U.S.Non-U.S.U.S.Non-U.S.
Service cost$66 $171 $78 $274 
Interest cost420 498 399 538 
Amortization of prior service credit and actuarial (gain) loss(1,182)125 (1,047)577 
Net periodic benefit (income) cost$(696)$794 $(570)$1,389 
The service cost component of net periodic benefit (income) cost is included in cost of products sold and selling, administrative and engineering expenses in the condensed consolidated statements of operations. All other components of net periodic benefit (income) cost are included in other income (expense), net in the condensed consolidated statements of operations for all periods presented.

On October 11, 2022, the Company’s Board of Directors approved a resolution to merge certain of the Company’s U.S. defined benefit pension plans, and terminate the resulting merged plan (“U.S. Pension Plan”) effective December 31, 2022. The
19
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

  Other Postretirement Benefits
 Three Months Ended September 30,
 2017 2016
  U.S.  Non-U.S.  U.S.  Non-U.S.
Service cost$79
 $110
 $90
 $94
Interest cost324
 179
 346
 172
Amortization of prior service credit and actuarial gain(479) (4) (507) (16)
Other1
 —
 1
 —
Net periodic benefit (income) cost$(75) $285
 $(70) $250
        
  Other Postretirement Benefits
 Nine Months Ended September 30,
 2017 2016
  U.S.  Non-U.S.  U.S.  Non-U.S.
Service cost$237
 $316
 $270
 $280
Interest cost972
 516
 1,038
 510
Amortization of prior service credit and actuarial gain(1,437) (12) (1,521) (47)
Other3
 —
 3
 —
Net periodic benefit (income) cost$(225) $820
 $(210) $743
U.Ktermination of the U.S. Pension Settlement
During 2016,Plan is expected to take twelve to eighteen months to complete. As part of the termination process, the Company undertook an initiativeexpects to de-risk pensionsettle benefit obligations inunder the U.K. by purchasingU.S. Pension Plan through a bulkcombination of lump sum payments to eligible plan participants and the purchase of a group annuity policy designedcontract, under which future benefit obligations and administration will be transferred to matcha third-party insurance company. Such settlements will be funded primarily from plan assets. Ultimate settlement of benefit obligations is dependent upon the liabilitiesparticipants’ elections. As of the plan, and subsequently entered into a wind-up process. During the three months ended September 30, 2017, the Company completed the wind-up process, resulting in a non-cash settlement charge of $5,7172022 and administrative expenses of $185, both of which are recorded in selling, administration & engineering expenses in the condensed consolidated statements of net income. As a result of the settlement, the Company’s overall projected benefit obligation as of December 31, 20162021, the U.S. Pension Plan was reducedoverfunded under U.S. generally accepted accounting principles by $17,100.$31,307 and $29,804, respectively.
Contributions
The Company made a discretionary contribution of $3,500 to its U.S. pension plan in the three months ended September 30, 2017.
11.13. Other Expense,Income (Expense), Net
The components of other expense,income (expense), net were as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Deconsolidation of joint venture (1)
$— $— $(2,257)$— 
Foreign currency gains (losses)649 (1,396)993 (5,546)
Components of net periodic benefit (cost) income other than service cost(434)531 (1,429)631 
Factoring costs(156)(117)(395)(421)
Miscellaneous income87 488 514 1,115 
Other income (expense), net$146 $(494)$(2,574)$(4,221)
(1)Loss attributable to deconsolidation of a joint venture in the Asia Pacific region, which required adjustment to fair value.
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Foreign currency losses$(1,455) $(331) $(4,033) $(2,035)
Secondary offering underwriting fees—
 —
 —
 (5,900)
Losses on sales of receivables(221) (207) (781) (674)
Miscellaneous income1,225
 20
 1,539
 20
Other expense, net$(451) $(518) $(3,275) $(8,589)
12.14. Income Taxes
The Company determines its effective tax rate each quarter based upon its estimated annual effective tax rate. The Company records the tax impact of certain unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, in the interim period in which they occur. In addition, jurisdictions with a projected loss for the year where no tax benefit can be recognized are excluded from the estimated annual effective tax rate.
Income tax (benefit) expense, loss before income taxes and the corresponding effective tax rate for the three and nine months ended September 30, 2022 and 2021 were as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Income tax (benefit) expense$(833)$32,121 $1,824 $15,598 
Loss before income taxes(34,053)(92,743)(127,337)(208,508)
Effective tax rate2 %(35)%(1)%(7)%
The effective tax rate for the three and nine months ended September 30, 2022 varied from the effective tax rate for the three and nine months ended September 30, 2021 primarily due to the initial recognition of valuation allowances in the U.S., resulting in tax expense of $31,740 and $13,278 recorded in the three and nine months ended September 30, 2021, respectively, the geographic mix of pre-tax losses, and the inability to record a benefit for pre-tax losses in the U.S. and certain foreign jurisdictions due to valuation allowances. Additionally the three and nine months ended September 30, 2022 were impacted by discrete tax impacts of the gain on sale-leaseback transaction in Europe, tax reserve changes, and other permanent items.
The income tax rate for the three and nine months ended September 30, 2022 and 2021 varied from the U.S. statutory rate primarily due to the inability to record a tax benefit for pre-tax losses in the U.S. and certain foreign jurisdictions, tax credits, the impact of income taxes on foreign earnings taxed at rates varying from the U.S. statutory rate, and other permanent items. Additionally, the income tax rate for the three and nine months ended September 30, 2021 varied from the U.S. statutory rate as a result of the initial recognition of valuation allowances in the U.S.
During the nine months ended September 30, 2022, the Company received $54,273 in cash payments from the United States Internal Revenue Service for tax refunds related to net operating loss carrybacks.

20
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

Income tax expense, income before income taxes and the corresponding effective tax rate for the three and nine months ended September 30, 2017 and 2016, was as follows:
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Income tax expense$7,838
 $12,525
 $40,258
 $43,312
Income before income taxes33,296
 49,171
 149,870
 151,735
Effective tax rate24% 25% 27% 29%
The effective tax rate for the three and nine months ended September 30, 2017 compared to the three and nine months ended September 30, 2016 was lower primarily due to nonrecurring discrete items, including the impact of participating in a foreign tax amnesty program, recorded in the three and nine months ended September 30, 2017. The income tax rate for the three and nine months ended September 30, 2017 varies from statutory rates primarily due to the impact of income taxes on foreign earnings taxed at rates lower than the U.S. statutory rate, the inability to record a tax benefit for pre-tax losses in certain foreign jurisdictions to the extent not offset by other categories of income, tax credits, income tax incentives, excess tax benefits related to share-based compensation and other permanent items. Further, the Company’s current and future provision for income taxes may beis impacted by the recognition ofchanges in valuation allowances in the U.S. and certain countries.foreign jurisdictions. The Company’s future provision for income taxes will include no tax benefit with respect to losses incurred and, except for certain jurisdictions, no tax expense with respect to income generated in these countries until the respective valuation allowances are eliminated. Accordingly, income taxes are impacted by changes in valuation allowances and the mix of earnings among jurisdictions. The Company intendsevaluates the realizability of its deferred tax assets on a quarterly basis. In completing this evaluation, the Company considers all available evidence in order to maintain thesedetermine, based on the weight of the evidence, if a valuation allowances untilallowance for its deferred tax assets is necessary. Such evidence includes historical results, future reversals of existing taxable temporary differences and expectations for future taxable income (exclusive of the reversal of temporary differences and carryforwards), as well as the implementation of feasible and prudent tax planning strategies. If, based on the weight of the evidence, it is more likely than not that all or a portion of the Company’s deferred tax assets will not be realized.realized, a valuation allowance is recorded. If operating results improve or decline on a continual basis in a particular jurisdiction, the Company’s decision regarding the need for a valuation allowance could change, resulting in either the initial recognition or reversal of a valuation allowance in that jurisdiction, which could have a significant impact on income tax expense in the period recognized and subsequent periods. In determining the provision for income taxes for financial statement purposes, the Company makes certain estimates and judgments, which affect its evaluation of the carrying value of its deferred tax assets, as well as its calculation of certain tax liabilities.
Inflation Reduction Action of 2022
13.On August 16, 2022, the U.S. enacted the Inflation Reduction Action of 2022, which, among other things, implements a 15% minimum tax on financial statement income of certain large corporations, a 1% excise tax on net stock repurchases and several tax incentives to promote clean energy. Based on its current analysis of the provisions, the Company does not believe this legislation will have a material impact on its consolidated financial statements, but the Company is continuing to evaluate the implications.
15. Net IncomeLoss Per Share Attributable to Cooper-Standard Holdings Inc.
Basic net incomeloss per share attributable to Cooper-Standard Holdings Inc. was computed by dividing net incomeloss attributable to Cooper-Standard Holdings Inc. by the weighted average number of shares of common stock outstanding during the period. Diluted net incomeloss per share attributable to Cooper-Standard Holdings Inc. was computed using the treasury stock method by dividing diluted net incomeloss available to Cooper-Standard Holdings Inc. by the weighted average number of shares of common stock outstanding, including the dilutive effect of common stock equivalents, using the average share price during the period.
Information used to compute basic and diluted net incomeloss per share attributable to Cooper-Standard Holdings Inc. was as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Net loss available to Cooper-Standard Holdings Inc. common stockholders$(32,686)$(123,173)$(127,293)$(220,648)
Basic weighted average shares of common stock outstanding17,218,165 17,097,766 17,181,534 17,027,226 
Dilutive effect of common stock equivalents— — — — 
Diluted weighted average shares of common stock outstanding17,218,165 17,097,766 17,181,534 17,027,226 
Basic net loss per share attributable to Cooper-Standard Holdings Inc.$(1.90)$(7.20)$(7.41)$(12.96)
Diluted net loss per share attributable to Cooper-Standard Holdings Inc.$(1.90)$(7.20)$(7.41)$(12.96)
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Net income attributable to Cooper-Standard Holdings Inc.$24,640
 $36,362
 $106,802
 $107,874
Increase in fair value of share-based awards—
 37
 —
 49
Diluted net income available to Cooper-Standard Holdings Inc. common stockholders$24,640
 $36,399
 $106,802
 $107,923
        
Basic weighted average shares of common stock outstanding17,703,660
 17,469,156
 17,769,808
 17,388,541
Dilutive effect of common stock equivalents976,858
 1,291,507
 1,068,479
 1,315,037
Diluted weighted average shares of common stock outstanding18,680,518
 18,760,663
 18,838,287
 18,703,578
        
Basic net income per share attributable to Cooper-Standard Holdings Inc.$1.39
 $2.08
 $6.01
 $6.20
        
Diluted net income per share attributable to Cooper-Standard Holdings Inc.$1.32
 $1.94
 $5.67
 $5.77
Approximately 107,000 securities wereSecurities excluded from the calculation of diluted earningsloss per share were approximately 52,000 and 169,000 for the three months ended September 30, 2022 and 2021, respectively, and 52,000 and 159,000 for the nine months ended September 30, 2017,2022 and 2021, respectively, because the inclusion of such securities in the calculation would have been anti-dilutive.
21
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

14.16. Accumulated Other Comprehensive Income (Loss)Loss
Changes in accumulated other comprehensive income (loss)loss by component, for the three and nine months ended September 30, 2017 and 2016, net of related tax, were as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Foreign currency translation adjustment
Balance at beginning of period$(147,736)$(134,377)$(138,751)$(136,579)
Other comprehensive loss before reclassifications(19,309)(1)(6,134)(1)(28,000)(1)(3,932)(1)
Amounts reclassified from accumulated other comprehensive loss— 144 (294)144 
Balance at end of period$(167,045)$(140,367)$(167,045)$(140,367)
Benefit plan liabilities
Balance at beginning of period$(62,256)$(102,729)$(65,303)$(106,079)
Other comprehensive income (loss) before reclassifications (net of tax expense (benefit) of $70, $27, $(174), and $(250), respectively)2,227 4,119 4,765 5,160 
Amounts reclassified from accumulated other comprehensive loss171 (2)859 (3)680 (4)3,168 (5)
Balance at end of period$(59,858)$(97,751)$(59,858)$(97,751)
Fair value change of derivatives
Balance at beginning of period$278 $942 $(1,130)$762 
Other comprehensive income (loss) before reclassifications (net of tax expense of $419, $154, $500, and $220, respectively)2,749 (1,760)4,564 (1,184)
Amounts reclassified from accumulated other comprehensive loss (net of tax expense of $159, $136, $314, and $277, respectively)(327)(372)(734)(768)
Balance at end of period$2,700 $(1,190)$2,700 $(1,190)
Accumulated other comprehensive loss, ending balance$(224,203)$(239,308)$(224,203)$(239,308)
(1)Includes other comprehensive (loss) income related to intra-entity foreign currency balances that are of a long-term investment nature of $(24,098) and $(9,265) for the three months ended September 30, 2022 and 2021, respectively, and $(28,333) and $(5,986) for the nine months ended September 30, 2022 and 2021, respectively.  
(2)Includes the effect of the amortization of actuarial losses of $138, and amortization of prior service cost of $37, net of tax of $4.
(3)Includes the effect of the amortization of actuarial losses of $664, amortization of prior service cost of $41, and impact of curtailment of $193, net of tax of $39.
(4)Includes the effect of the amortization of actuarial losses of $562, and amortization of prior service cost of $130, net of tax of $12.
(5)Includes the effect of the amortization of actuarial losses of $2,916, amortization of prior service cost of $169, and impact of curtailment of $310, net of tax of $227.

22
 Three Months Ended September 30, 2017
 Cumulative currency translation adjustment Benefit plan
liabilities		 Fair value change of derivatives Total
Balance as of June 30, 2017$(119,405) $(100,340) $113
 $(219,632)
Other comprehensive income (loss) before reclassifications16,047
(1) 
(1,714)
(2) 
(619)
(3) 
13,714
Amounts reclassified from accumulated other comprehensive income (loss)—
 5,677
(4) 
(347)
(5) 
5,330
Balance as of September 30, 2017$(103,358) $(96,377) $(853) $(200,588)
(1)Includes $4,314 of other comprehensive income related to intra-entity foreign currency balances that are of a long-term investment nature.
(2)Net of tax benefit of $130.
(3)Net of tax benefit of $122. See Note 8.
(4)Includes losses related to the U.K. pension settlement of $6,288 and actuarial losses of $901, offset by prior service credits of $84, net of tax of $1,428. See Note 10.
(5)Net of tax expense of $105. See Note 8.
 Three Months Ended September 30, 2016
 Cumulative currency translation adjustment Benefit plan
liabilities		 Fair value change of derivatives Total
Balance as of June 30, 2016$(120,780) $(84,595) $(4,766) $(210,141)
Other comprehensive income (loss) before reclassifications2,681
(1) 
(497)
(2) 
828
(3) 
3,012
Amounts reclassified from accumulated other comprehensive income (loss)—
 348
(4) 
1,053
(5) 
1,401
Balance as of September 30, 2016$(118,099) $(84,744) $(2,885) $(205,728)
(1)Includes $511 of other comprehensive income related to intra-entity foreign currency balances that are of a long-term investment nature.
(2)Net of tax expense of $46.
(3)Net of tax expense of $157. See Note 8.
(4)Includes actuarial losses of $555, offset by prior service credits of $79, net of tax of $128. See Note 10.
(5)Net of tax benefit of $519. See Note 8.
 Nine Months Ended September 30, 2017
 Cumulative currency translation adjustment Benefit plan
liabilities		 Fair value change of derivatives Total
Balance as of December 31, 2016$(143,481) $(97,612) $(1,470) $(242,563)
Other comprehensive income (loss) before reclassifications40,123
(1) 
(5,428)
(2) 
1,242
(3) 
35,937
Amounts reclassified from accumulated other comprehensive income (loss)—
 6,663
(4) 
(625)
(5) 
6,038
Balance as of September 30, 2017$(103,358) $(96,377) $(853) $(200,588)
(1)Includes $10,484 of other comprehensive income related to intra-entity foreign currency balances that are of a long-term investment nature.
(2)Net of tax benefit of $189.
(3)Net of tax expense of $591. See Note 8.
(4)Includes losses related to the U.K. pension settlement of $6,288 and actuarial losses of $2,443, offset by prior service credits of $248, net of tax of $1,820. See Note 10.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

(5)Net of tax benefit of $18. See Note 8.
 Nine Months Ended September 30, 2016
 Cumulative currency translation adjustment Benefit plan
liabilities		 Fair value change of derivatives Total
Balance as of December 31, 2015$(130,661) $(84,124) $(2,280) $(217,065)
Other comprehensive income (loss) before reclassifications12,562
(1) 
(1,638)
(2) 
(3,803)
(3) 
7,121
Amounts reclassified from accumulated other comprehensive income (loss)—

1,018
(4) 
3,198
(5) 
4,216
Balance as of September 30, 2016$(118,099) $(84,744) $(2,885) $(205,728)
(1)Includes $9,699 of other comprehensive income related to intra-entity foreign currency balances that are of a long-term investment nature.
(2)Net of tax benefit of $122.
(3)Net of tax benefit of $1,704. See Note 8.
(4)Includes actuarial losses of $1,636 offset by prior service credits of $246, net of tax of $372. See Note 10.
(5)Net of tax benefit of $1,575. See Note 8.
15.17. Common Stock
Share Repurchase Program and Secondary Offering
In March 2016,June 2018, the Company’s Board of Directors approved a securitiescommon stock repurchase program (the “Program”“2018 Program”) authorizing the Company to repurchase, in the aggregate, up to $125,000$150,000 of its outstanding common stock or warrants to purchase common stock. Under the 2018 Program, repurchases may be made on the open market, or through private transactions, accelerated share repurchases, round lot or block transactions on the New York Stock Exchange or otherwise, as determined by the Company’s management and in accordance with prevailing market conditions and federal securities laws and regulations. DuringThe Company expects to fund any future repurchases from cash on hand and future cash flows from operations. The Company is not obligated to acquire a particular amount of securities, and the 2018 Program may be discontinued at any time at the Company’s discretion. The 2018 Program became effective in November 2018. As of September 30, 2022, the Company had approximately $98,720 of repurchase authorization remaining under the 2018 Program. The Company did not make any repurchases under the 2018 Program during the nine months ended September 30, 2017, the Company repurchased 306,072 shares at an average purchase price of $102.76 per share, excluding commissions, for a total cost of $31,452, of which $30,680 was settled in cash as of September 30, 2017.2022 or 2021.
In March 2016, certain selling stockholders affiliated with Silver Point Capital, L.P., Oak Hill Advisors, L.P. and Capital World Investors (the “Selling Stockholders”) sold 2,278,031 shares, including overallotments, of the Company’s common stock at a public offering price of $68.00 per share, in a secondary public offering. Of the 2,278,031 shares sold in the offering, 350,000 shares were purchased by the Company for $23,800. The Company paid the underwriting discounts and commissions payable on the shares sold by the Selling Stockholders, excluding the shares the Company repurchased, resulting in $5,900 of fees incurred for the nine months ended September 30, 2016, which is included in other expense, net in the condensed consolidated statement of net income. The Company also incurred approximately $600 of other expenses related to legal and audit services for the nine months ended September 30, 2016, which is included in selling, administration & engineering expenses in the condensed consolidated statement of net income. The Company did not sell or receive any proceeds from the sales of shares by the Selling Stockholders.
As of September 30, 2017, the Company had approximately $69,700 of repurchase authorization remaining under the Program.
16.18. Share-Based Compensation
The Company’s long-term incentive plans allow for the grant of various types of share-based awards to key employees and directors of the Company and its affiliates. The Company generally awards grants on an annual basis.

In February 2017,2022, the Company granted Restricted Stock Units (“RSUs”), and Performance Units (“PUs”) and stock options. The RSUs cliff vest after three years, the PUs cliff vest at the end of their three-year performance period, and the stock options vest ratably over three years.. The number of PUs that will vest depends on the Company’s achievement of target performance goals related to the Company’s return on invested capital (“ROIC”), and total shareholder return, which may range from 0% to 200% of the target award amount. The grant-date fair valuePUs tied to total shareholder return cliff vest at the end of a three-year performance period. The PUs tied to ROIC cliff vest one year after the end of their individual performance periods. The RSUs and PUs was determined using the closing price of the Company’s common stock on the date of grant. The grant-date fair value of the stock options was determined using the Black-Scholes option pricing model.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

vest ratably over three years.
Share-based compensation expense was as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
PUs$203 $357 $515 $51 
RSUs476 873 1,097 3,004 
Stock options289 549 981 1,726 
Total$968 $1,779 $2,593 $4,781 
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
PUs$4,327
 $4,635
 $9,171
 $9,953
RSUs2,052
 2,052
 6,896
 5,805
Stock options933
 953
 2,939
 2,775
Total$7,312
 $7,640
 $19,006
 $18,533
17. Related Party Transactions
A summary of the material related party transactions with affiliates accounted for under the equity method was as follows:
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Sales(1)
$8,288
 $9,029
 $26,124
 $26,027
Purchases(1)
186
 170
 580
 365
Dividends received(2)
—
 —
 5,382
 3,022
(1) Relates to transactions with Nishikawa Cooper LLC (“NISCO”)
(2) From NISCO and Nishikawa Tachaplalert Cooper Ltd.
Amounts receivable from NISCO and Sujan Cooper Standard AVS Private Limited as of September 30, 2017 and December 31, 2016 were $3,789 and $4,078, respectively.
In March 2016, as part of the secondary offering, the Company paid $5,900 of fees incurred on behalf of the Selling Stockholders as defined in Note 15. “Common Stock.”
18.19. Commitments and Contingencies
The Company is periodically involved in claims, litigation and various legal matters that arise in the ordinary course of business. The Company accrues for litigation exposure when it is probable that future costs will be incurred and such costs can be reasonably estimated. Any resulting adjustments, which could be material, are recorded in the period the adjustments are identified. As of September 30, 2017,2022, the Company does not believe that there is a reasonable possibility that any material loss exceeding the amounts already recognized for claims, litigation and various legal matters, if any, has been incurred. However, the ultimate resolutions of these proceedings and matters are inherently unpredictable. As such, the Company’s financial condition, results of operations or cash flows could be adversely affected in any particular period by the unfavorable resolution of one or more of these proceedings or matters.
In addition, the Company conducts and monitors environmental investigations and remedial actions at certain locations. As of September 30, 20172022 and December 31, 2016,2021, the Company had approximately $10,780 and $9,965, respectively, reserved in accrued liabilities and other liabilities on the condensed consolidated balance sheets on an undiscounted reserve forbasis. While the Company’s costs to defend and settle known claims arising under environmental investigationlaws have not been material in the past and remediation was approximately $4,742 and $5,490, respectively. The Company doesare not believe that the environmental liabilities associated with its current and former properties willcurrently estimated to have a material adverse impacteffect on itsthe Company’s financial condition, results of operations or cash flows; however, no assurances cansuch costs may be givenmaterial to the Company’s financial statements in this regard.the future.
20. Segment Reporting
The CompanyCompany’s automotive business is participatingorganized in a voluntary foreign tax amnesty program, which allows for the settlement of certain tax matters at reduced amounts. During the three months ended September 30, 2017, the Company incurred charges of $3,121, of which $2,886 was a non-cash charge offset by the utilization of tax net operating loss carryforwards, resultingfollowing reportable segments: North America, Europe, Asia Pacific and South America. All other business activities are reported in a net $235 expense impact to net income.Corporate, eliminations and other. The Company does not expect to incur additional material losses under this program, however the settlement of these tax matters is outstanding and the outcomeCompany’s principal products within each of the program is uncertain.reportable segments are sealing, fuel and brake delivery, and fluid transfer systems.
23
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)

19. Segment Reporting
The Company has determined that it operates in four reportable segments, North America, Europe, Asia Pacificuses Segment adjusted EBITDA as the measure of earnings to assess the performance of each segment and South America. The Company’s principal products within each of these segments are sealing, fuel and brake delivery, fluid transfer and anti-vibration systems. The Company evaluates segment performance based on segment profit before tax.determine the resources to be allocated to the segments. The results of each segment include certain allocations for general, administrative interest and other shared costs. Segment adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.
Certain financial information on the Company’s reportable segments was as follows:
Three Months Ended September 30,
20222021
External SalesIntersegment SalesAdjusted EBITDAExternal SalesIntersegment SalesAdjusted EBITDA
North America$351,011 $3,223 $19,401 $270,592 $2,711 $8,817 
Europe113,670 2,142 (10,905)98,682 1,903 (25,112)
Asia Pacific129,493 1,065 7,523 109,526 306 (14,274)
South America27,073 11 766 15,981 — (3,422)
Total Automotive621,247 6,441 16,785 494,781 4,920 (33,991)
Corporate, eliminations and other35,906 (6,441)3,720 31,909 (4,920)132 
Consolidated$657,153 $— $20,505 $526,690 $— $(33,859)
Nine Months Ended September 30,
20222021
External SalesIntersegment SalesAdjusted EBITDAExternal SalesIntersegment SalesAdjusted EBITDA
North America$1,004,592 $9,500 $52,338 $857,153 $7,484 $50,806 
Europe371,371 6,052 (40,878)397,079 7,718 (40,992)
Asia Pacific319,025 2,598 (1,018)327,666 1,794 (13,024)
South America74,853 16 (941)45,620 15 (6,756)
Total Automotive1,769,841 18,166 9,501 1,627,518 17,011 (9,966)
Corporate, eliminations and other106,213 (18,166)775 101,324 (17,011)(79)
Consolidated$1,876,054 $— $10,276 $1,728,842 $— $(10,045)
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Adjusted EBITDA$20,505 $(33,859)$10,276 $(10,045)
Restructuring charges(1,701)(1,573)(13,014)(34,251)
Deconsolidation of joint venture— — (2,257)— 
Impairment charges(379)(1,006)(837)(1,847)
(Loss) gain on sale of business, net— — — 696 
Gain on sale of fixed assets, net— — 33,391 — 
Lease termination costs— (322)— (430)
Indirect tax and customs adjustments(569)— (1,477)— 
EBITDA$17,856 $(36,760)$26,082 $(45,877)
Income tax expense833 (32,121)(1,824)(15,598)
Interest expense, net of interest income(20,747)(18,243)(57,378)(54,152)
Depreciation and amortization(30,628)(36,049)(94,173)(105,021)
Net loss attributable to Cooper-Standard Holdings Inc.$(32,686)$(123,173)$(127,293)$(220,648)

24
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(Dollar amounts in thousands except per share and share amounts)
September 30, 2022December 31, 2021
Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Sales to external customers       
Segment assets:Segment assets:
North America$437,406
 $450,795
 $1,403,270
 $1,361,183
North America$900,990 $885,517 
Europe254,399
 242,773
 776,346
 794,411
Europe364,208 372,097 
Asia Pacific148,493
 137,174
 421,926
 380,483
Asia Pacific437,627 510,524 
South America28,718
 24,914
 78,670
 61,380
South America78,142 61,479 
Total AutomotiveTotal Automotive1,780,967 1,829,617 
Corporate, eliminations and otherCorporate, eliminations and other321,234 396,876 
Consolidated$869,016
 $855,656
 $2,680,212
 $2,597,457
Consolidated$2,102,201 $2,226,493 
       
Intersegment sales       
North America$3,285
 $3,409
 $10,108
 $9,908
Europe3,861
 3,600
 11,188
 10,081
Asia Pacific1,566
 1,426
 3,876
 3,925
South America2
 1
 11
 5
Eliminations(8,714) (8,436) (25,183) (23,919)
Consolidated$—
 $—
 $—
 $—
       
Segment profit (loss)       
North America$44,214
 $55,031
 $170,971
 $169,857
Europe(9,024) (5,632) (20,633) (7,510)
Asia Pacific3,050
 3,037
 11,036
 6,073
South America(4,944) (3,265) (11,504) (16,685)
Consolidated income before income taxes$33,296
 $49,171
 $149,870
 $151,735



25
 September 30,
2017		 December 31,
2016
Segment assets   
North America$1,030,321
 $985,809
Europe648,588
 582,385
Asia Pacific653,688
 611,849
South America57,794
 46,125
Eliminations and other245,205
 265,534
Consolidated$2,635,596
 $2,491,702



Item 2.        Management’s Discussion and Analysis of Financial Condition and Results of Operations
This management’s discussion and analysis of financial condition and results of operations is intended to assist in understanding and assessing the trends and significant changes in our results of operations and financial condition. Our historical results may not indicate, and should not be relied upon as an indication of, our future performance. Our forward-looking statements reflect our current views about future events, are based on assumptions and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those contemplated by these statements. See “Forward-Looking Statements” below for a discussion of risks associated with reliance on forward-looking statements. Factors that may cause differences between actual results and those contemplated by forward-looking statements include, but are not limited to, those discussed below and in our Annual Report on Form 10-K for the fiscal year ended December 31, 20162021 filed with the U.S. Securities and Exchange Commission (“20162021 Annual Report”) see, including Item 1A. “Risk Factors.” The following should be read in conjunction with our 20162021 Annual Report and the other information included herein. Our discussion of trends and conditions supplements and updates such discussion included in our 20162021 Annual Report. References in this quarterly report on Form 10-Q (the “Report”) to “we,” “our,” or the “Company” refer to Cooper-Standard Holdings Inc., together with its consolidated subsidiaries.
Executive Overview
Our Business
We design, manufacture and sell sealing, fuel and brake delivery, and fluid transfer and anti-vibration systems for use primarily in passenger vehicles and light trucks manufactured by global automotive original equipment manufacturers (“OEMs”) and replacement markets.. We are primarily a “Tier 1” supplier, with approximately 83% of our sales in 2021 made directly to major OEMs. We operate our automotive business along fourthe following reportable segments: North America, Europe, Asia Pacific and South America. WeAll other business activities are primarily a “Tier 1” supplier, with approximately 84% of our salesreported in 2016 made directly to major OEMs.Corporate, eliminations and other.
Recent Trends and Conditions
General Economic Conditions and Outlook
The global automotive industry is susceptible to uncertain economic conditions that could adversely impact new vehicle demand.demand and production. Business conditions may vary significantly from period to period or region to region. In 2021, global automotive production was negatively impacted by lingering impacts of the COVID-19 pandemic and broad supply chain challenges stemming, in part, from a sharp rebound in overall industrial demand. In 2022, rising inflation, interest rates and continuing supply chain challenges are contributing to global economic uncertainty. In addition, recent pandemic related restrictions imposed in certain large population centers in China, the threat of additional lockdowns, and continuing military actions in Eastern Europe are having broad negative impacts on key sectors of the global economy.
In North America, whileU.S. consumer confidence has trended downward since the U.S. economy has been relatively stable, market indicators show signssecond quarter of softening2021. Key drivers of the decline are significant inflation, continuing supply chain disruptions and rising interest rates. Geopolitical tensions and uncertainty surrounding the upcoming mid-term elections in the United States are also important factors. However, low unemployment rates, rising wages, continued government spending and private spending related to pent-up consumer demand. The mixdemand continue to support economic growth. Economists at the International Monetary Fund (IMF) are expecting the economies of vehicles produced continuesthe United States, Canada and Mexico to shift away from passenger cars into crossover utility vehiclesgrow by 1.6 percent, 3.3 percent and light trucks.2.1 percent, respectively, in 2022 with growth expectations moderating to 1.0 percent, 1.3 percent and 1.2 percent, respectively, in 2023.
In Europe, the continuing economic recoverywar in Ukraine, related sanctions imposed on Russia and infrastructure disruptions are having a dramatic impact on energy prices and energy security. This is driving increased demandtranslating into lower output and higher inflation for light vehicles. Certain countries withinmost Eurozone countries. Supply chain disruptions have also hurt certain industries including the automobile sector, with the war and sanctions hindering the production of key input materials. With the European region are faced with an uncertainCentral Bank having ended stimulative asset purchases and potentially volatile geopolitical climate, which could impact consumer confidence andaggressively raising policy interest rates to stem inflation, economic growth.
The Chinese government continues to manage the nation’s economy with a goal of sustaining growth. Overall economic growth consumer preferences and an expanding middle class in China continue to drive crossover utility vehicle demand higher, while demand for passenger cars is expected to decline slightlymoderate in the fourth quarter of 2022. Economists at the IMF are currently expecting the economy in the Eurozone region to grow by approximately 3.1 percent for the full year over year.2022 but just 0.5 percent in 2023.
Finally, dueIn the Asia Pacific region, the combination of more transmissible variants and the strict zero-COVID strategy in China has led to continuedrepeated mobility restrictions and localized lockdowns that have weighed on economic activity and private consumption. Moreover, real estate investment in China, once a key driver of economic growth, has slowed significantly. However, higher infrastructure investment and government spending are expected to support growth for the remainder of 2022 and into 2023. Economists at the IMF are expecting the Chinese economy to grow 4.3 percent in 2022, with expected growth moderating to just 2.6 percent in 2023.
In South America, the Brazilian economy continues to expand amid fiscal support and the lessening impact of the COVID-19 pandemic. Increasing exports of goods and services have provided strong support and the unemployment rate remains low. Certain fiscal interventions such as recently enacted tax cuts and fuel subsidies have provided stimulative support
26

to the Brazilian economy in the second half of 2022 but may expire following the runoff presidential elections in late October. This would likely result in slower economic growth rates going forward. Economists at the IMF are now estimating the Brazilian economy will grow 2.9 percent for the full year 2022, with growth moderating to just 0.7 percent in 2023. We remain cautious for the economic outlook in this market given the long history of political instability and economic volatility in Brazil,the region.
Raw Materials
Our business is susceptible to inflationary pressures with respect to raw materials which may place operational and profitability burdens on the entire supply chain. Costs related to raw materials, such as steel, aluminum, and oil-derived commodities, continue to be volatile, which led to significant increases in these costs in 2021. Current global events continue to add further price pressure and uncertainty to raw material costs for 2022. In addition, we remain cautious about consumer confidencecontinue to see significant inflationary pressure on wages, energy, transportation and vehicle demand in this region.other general costs. As such, we will continue to work on an ongoing basis with our customers and suppliers to mitigate both inflationary pressures and our material-related cost exposures through a combination of expanded index-based agreements and other commercial enhancements.
Production Levels
Our business is directly affected by the automotive vehicle production rates in North America, Europe, Asia Pacific and South America. New vehicle demand is drivenAmerica which have been adversely affected by macroeconomica series of events in recent years. Beginning in the first quarter of 2020, we experienced production shutdowns related to the COVID-19 pandemic. Beginning in the first quarter of 2021, OEM production volumes were disrupted by the global shortage of semiconductors, but have improved sequentially quarter over quarter. In 2022, disruptions stemming from the Russia-Ukraine crisis and other factors,lockdowns in key Chinese manufacturing and trading hubs such as interest rates, manufacturerShenzhen and dealer sales incentives, fuel prices, consumer confidence, employment levels, income growth trendsShanghai have further exacerbated supply chain disruptions and government and tax incentives. The industry could face uncertainties that may adversely impact consumer demand for vehicles as well as the future production environment.
In North America, light vehicle inventory in the U.S. had risen significantly above normalized levels at the end of the second quarter of 2017. Production cuts by OEMs in the third quarter of 2017 were successful in bringing inventory closer to normalized levels and more aligned with consumer demand. Even in view of lower inventory levels, we expect overall light vehicle production in the fourth quarter of 2017 to be slightly lower than in the fourth quarter of 2016, driven largely by continued lower production of passenger cars. European light vehicle production has seen modest year-over-year growth through the first three quarters of 2017 and we expect this trend to continue through the fourth quarter of 2017. In Asia Pacific, we expect light vehicle production tolevels. We continue to grow sequentially at modest levels through the remainder of 2017, driven mainly by China.


collaborate closely with our customers to minimize production inefficiencies while supporting their needs.
Light vehicle production in certain regions for the three and nine months ended September 30, 20172022 and 2016 was:2021 was as follows:
Three Months Ended September 30,Nine Months Ended September 30,
(In millions of units)
2022(1)
2021(1)
% Change
2022(1)
2021(1)
% Change
North America3.7 3.0 24.2%10.8 9.8 10.6%
Europe3.6 3.0 20.3%11.5 11.9 (3.3)%
Asia Pacific12.5 9.6 29.9%34.1 31.0 9.9%
Greater China7.2 5.5 31.2%19.0 17.1 10.9%
South America0.8 0.6 33.4%2.1 1.9 10.0%
 Three Months Ended September 30, Nine Months Ended September 30,
(In millions of units)
2017(1)
 
2016(1)
 % Change 
2017(1)
 
2016(1)
 % Change
North America4.0
 4.4
 (9.7)% 13.0
 13.5
 (3.7)%
Europe5.0
 4.7
 5.2% 16.6
 16.2
 2.4%
Asia Pacific(2)
11.9
 11.5
 3.5% 36.0
 34.7
 3.6%
South America0.9
 0.7
 26.1% 2.4
 2.0
 20.9%
(1)Production data based on IHS Automotive, October 2017.
(2)Includes Greater China units of 6.4 for both the three months ended September 30, 2017 and 2016, and 19.5 and 19.0 for the nine months ended September 30, 2017 and 2016, respectively.
Industry Overview(1)Production data based on S&P Global (formerly IHS Markit), October 2022.
CompetitionIn all regions, production volumes were impacted by the global shortage of semiconductors which began in the automotive supplier industry is intensefirst quarter of 2021 and has increased in recent years as OEMsdeteriorated thereafter throughout the year. Production stoppages related to semiconductor and other supply chain shortages continued into 2022, but have demonstrated a preference for stronger relationships with fewer suppliers. Because of a growing emphasis on globalimproved sequentially quarter over quarter. In Europe, vehicle platforms, automotive suppliers with a global manufacturing footprint capable of fully servicing customers around the world will typically have a competitive advantage over smaller, regional competitors. This dynamic is likely to result in further consolidation of competing suppliers within our industry over time.
OEMs have shifted some research and development, design and testing responsibility to suppliers, while at the same time shortening new product cycle times. To remain competitive, suppliers must have state-of-the-art engineering and design capabilities and must be able to continuously improve their engineering, design and manufacturing processes to effectively service the customer. Suppliers are increasingly expected to collaborate on, or assume the product design and development of, key automotive components and to provide innovative solutions to meet evolving technologies aimed at improved emissions and fuel economy.
Increased competitivenessproduction in the industry, as well as customer focus on costs, has resulted in pressure on suppliers for price reductions, reducing the overall profitability of the industry. Consolidations and market share shifts among vehicle manufacturers continue to putnine months ended September 30, 2022 was negatively impacted by additional pressures on the supply chain. These pricing and market pressures will continue to drive our focus on reducing our overall cost structure through continuous improvement initiatives, capital redeployment, restructuring and other cost management processes.
In additionchain issues related to the above, other factors will present opportunities for automotive suppliers who are positioned for the changing environment, including autonomous and connected vehicles, evolving government regulation, and consumer preference for environmentally friendly products and technology, including hybrid and electric vehicle architectures.

Russia-Ukraine crisis.

27

Results of Operations
 Three Months Ended September 30,Nine Months Ended September 30,
 20222021Change20222021Change
(dollar amounts in thousands)
Sales$657,153 $526,690 $130,463 $1,876,054 $1,728,842 $147,212 
Cost of products sold618,594 534,817 83,777 1,800,577 1,669,610 130,967 
Gross profit (loss)38,559 (8,127)46,686 75,477 59,232 16,245 
Selling, administration & engineering expenses44,847 60,367 (15,520)149,033 168,506 (19,473)
Gain on sale of business, net— — — — (696)696 
Gain on sale of fixed assets, net— — — (33,391)— (33,391)
Amortization of intangibles1,693 1,819 (126)5,176 5,524 (348)
Restructuring charges1,701 1,573 128 13,014 34,251 (21,237)
Impairment charges379 1,006 (627)837 1,847 (1,010)
Operating loss(10,061)(72,892)62,831 (59,192)(150,200)91,008 
Interest expense, net of interest income(20,747)(18,243)(2,504)(57,378)(54,152)(3,226)
Equity in (losses) earnings of affiliates(3,391)(1,114)(2,277)(8,193)65 (8,258)
Other income (expense), net146 (494)640 (2,574)(4,221)1,647 
Loss before income taxes(34,053)(92,743)58,690 (127,337)(208,508)81,171 
Income tax (benefit) expense(833)32,121 (32,954)1,824 15,598 (13,774)
Net loss(33,220)(124,864)91,644 (129,161)(224,106)94,945 
Net loss attributable to noncontrolling interests534 1,691 (1,157)1,868 3,458 (1,590)
Net loss attributable to Cooper-Standard Holdings Inc.$(32,686)$(123,173)$90,487 $(127,293)$(220,648)$93,355 
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 Change 2017 2016 Change
 (dollar amounts in thousands)
Sales$869,016
 $855,656
 $13,360
 $2,680,212
 $2,597,457
 $82,755
Cost of products sold718,187
 690,984
 27,203
 2,187,058
 2,101,000
 86,058
Gross profit150,829
 164,672
 (13,843) 493,154
 496,457
 (3,303)
Selling, administration & engineering expenses94,145
 92,368
 1,777
 267,883
 268,498
 (615)
Amortization of intangibles3,432
 3,457
 (25) 10,563
 9,974
 589
Impairment charges—
 —
 —
 4,270
 —
 4,270
Restructuring charges9,909
 10,430
 (521) 28,220
 33,468
 (5,248)
Other operating loss—
 —
 —
 —
 155
 (155)
Operating profit43,343
 58,417
 (15,074) 182,218
 184,362
 (2,144)
Interest expense, net of interest income(10,256) (10,114) (142) (31,788) (29,861) (1,927)
Equity in earnings of affiliates660
 1,386
 (726) 3,735
 5,823
 (2,088)
Loss on refinancing and extinguishment of debt—
 —
 —
 (1,020) —
 (1,020)
Other expense, net(451) (518) 67
 (3,275) (8,589) 5,314
Income before income taxes33,296
 49,171
 (15,875) 149,870
 151,735
 (1,865)
Income tax expense7,838
 12,525
 (4,687) 40,258
 43,312
 (3,054)
Net income25,458
 36,646
 (11,188) 109,612
 108,423
 1,189
Net income attributable to noncontrolling interests(818) (284) (534) (2,810) (549) (2,261)
Net income attributable to Cooper-Standard Holdings Inc.$24,640
 $36,362
 $(11,722) $106,802
 $107,874
 $(1,072)

Three Months Ended September 30, 20172022 Compared with Three Months Ended September 30, 20162021
Sales.Sales
Three Months Ended September 30,Variance Due To:
20222021ChangeVolume / Mix*Foreign ExchangeDeconsolidation
(dollar amounts in thousands)
Total sales$657,153 $526,690 $130,463 $168,724 $(32,114)$(6,147)
* Net of customer price adjustments, including recoveries

Sales for the three months ended September 30, 20172022 increased $13.4 million, or 1.6%24.8%, compared to the three months ended September 30, 2016, primarily2021. The increase in sales was driven by volume and mix (higher net vehicle production volume due to the acquisitionimpact of AMI Industries’ fuellessening semiconductor supply issues in the current year) and brake business, consolidationnet customer price adjustments including recovery of a previously unconsolidated joint venture and favorable foreign exchange,cost increases. This was partially offset by the negative impact of foreign exchange, and the deconsolidation of a joint venture in the Asia Pacific region. See Note 2. “Deconsolidation and Divestiture” to the unaudited condensed consolidated financial statements included in Part I, Item 1 of this Report for additional information.
28

Gross Profit
Three Months Ended September 30,Variance Due To:
20222021ChangeVolume / Mix*Foreign ExchangeCost Increases/(Decreases)**
(dollar amounts in thousands)
Cost of products sold$618,594 $534,817 $83,777 $100,132 $(30,584)$14,229 
Gross profit38,559 (8,127)46,686 68,592 (1,530)(20,376)
Gross profit percentage of sales5.9 %(1.5)%
* Net of customer price reductions.adjustments, including recoveries
Cost** Net of Products Sold.deconsolidation
Cost of products sold is primarily comprised of material, labor, manufacturing overhead, freight, depreciation, and amortizationwarranty costs and other direct operating expenses. Cost of products sold for the three months ended September 30, 2017 increased $27.2 million, or 3.9%, compared to the three months ended September 30, 2016. CostThe Company’s material cost of products sold was impacted by commodity price pressures, transactional foreign exchange pressure, general inflationapproximately 52% and acquisitions. These items were partially offset by continuous improvement and material cost savings. Materials comprise the largest component47% of our cost of products sold and represented approximately 50% of the total cost of products sold for the three months ended September 30, 20172022 and 2016,2021, respectively. The change in cost of products sold was impacted by higher volume and mix, commodity inflation, higher labor and overhead costs due to inconsistent volume production schedules, higher compensation related costs, and higher energy and transportation costs. These costs were partially offset by foreign exchange, manufacturing efficiencies, purchasing lean savings, restructuring savings and the deconsolidation of a joint venture in the Asia Pacific region.
Gross Profit.Gross profit for the three months ended September 30, 2017 decreased $13.82022 increased $46.7 million, or 8.4%, compared to the three months ended September 30, 2016. As a percentage of sales, gross profit was 17.4% and 19.2% for the three months ended September 30, 2017 and 2016, respectively.2021. The decrease in gross profitchange was driven primarily by volume and mix, net customer price reductions, commodity price pressures,adjustments including recovery of cost increases, manufacturing efficiencies, purchasing lean savings and unfavorable vehicle production mix. These items wererestructuring savings, partially offset by continuous improvement,commodity and material cost savings.wage inflation, higher compensation related costs, higher energy and transportation costs and foreign exchange.
Selling, Administration and Engineering.Engineering Expense. Selling, administration and engineering expense includes administrative expenses as well as product engineering and design and development costs. Selling, administration and engineering expense for the three months ended September 30, 20172022 was $94.1 million, or 10.8%6.8% of sales compared to $92.4 million, or 10.8% of sales,11.5% for the three months ended September 30, 2016. Selling, administration2021. The decrease was primarily due to the non-recurrence of a prior year credit loss, salaried headcount initiative savings and engineering expenseforeign exchange partially offset by higher compensation related costs.
Amortization of Intangibles. Intangible amortization for the three months ended September 30, 2017 increased as a result of non-cash settlement charges relating2022 was comparable to the wind-up of our U.K. pension plan of $5.7 million and investments to support growth and innovation, partially offset by lower compensation related costs.three months ended September 30, 2021.
Restructuring.Restructuring charges for the three months ended September 30, 20172022 was comparable to the three months ended September 30, 2021.
Impairment Charges. Non-cash impairment charges for the three months ended September 30, 2022 decreased $0.5$0.6 million compared to the three months ended September 30, 2016. The decrease was2021, primarily driven by lower restructuring expenses relateddue to ourimpairments in Europe in the prior year period.


European initiatives of $3.4 million, partially offset by higher restructuring charges attributed to North America and Asia Pacific of $2.9 million.
OtherInterest Expense, Net. OtherNet interest expense for the three months ended September 30, 2017 decreased $0.12022 increased $2.5 million compared to the three months ended September 30, 2016,2021, primarily due to other miscellaneousan increase in interest rates on variable rate debt.
Other Income, Net. Other income, partially offset by increased foreign currency losses.
Income Tax Expense. Income tax expensenet, for the three months ended September 30, 20172022 increased $0.6 million compared to the three months ended September 30, 2021, primarily due to the favorable impact of foreign exchange.
Income Tax Expense. Income tax benefit for the three months ended September 30, 2022 was $7.8$0.8 million on earningslosses before income taxes of $33.3 million. This compares$34.1 million compared to an income tax expense of $12.5$32.1 million on earningslosses before income taxes of $49.2$92.7 million for the same period of 2016.three months ended September 30, 2021. The effective tax rate for the three months ended September 30, 2017 compared to2022 differed from the three months ended September 30, 2016 was lower primarily due to nonrecurring discrete items, including the impact of participating in a foreign tax amnesty program, recorded in the three months ended September 30, 2017. The incomeeffective tax rate for the three months ended September 30, 2017 varied from statutory rates2021 primarily due to the impactgeographic mix of income taxes on foreign earnings taxed at rates lower than the U.S. statutory rate,pre-tax losses, the inability to record a tax benefit for pre-tax losses in the U.S. and certain foreign jurisdictions due to the extent not offset by other categories of income, tax credits, income tax incentives, excess tax benefits related to share-based compensationvaluation allowances, and other permanent items.items during the three-month period ended September 30, 2022. Additionally, a discrete expense of $31.7 million for the initial recognition of valuation allowance against net deferred tax assets in the U.S. was recorded in the three months ended September 30, 2021.
29

Nine Months Ended September 30, 20172022 Compared with Nine Months Ended September 30, 20162021
Sales.Sales
Sales for the nine months ended September 30, 20172022 increased $82.8 million, or 3.2%8.5%, compared to the nine months ended September 30, 2016, primarily due to improved2021. The increase in sales was driven by volume and mix (higher net vehicle production volume due to the impact of lessening semiconductor supply issues in all regions, the acquisition of AMI Industries’ fuel and brake business and consolidation of a previously unconsolidated joint venture,current year partially offset by the impact of COVID-19 in China and the Ukraine conflict in Europe) and net customer price reductionsadjustments including recovery of cost increases. This was partially offset by foreign exchange, and unfavorable foreign exchange.the deconsolidation of a joint venture in the Asia Pacific region. See Note 2. “Deconsolidation and Divestiture” to the unaudited condensed consolidated financial statements included in Part I, Item 1 of this Report for additional information.
Cost
Nine Months Ended September 30,Variance Due To:
20222021ChangeVolume / Mix*Foreign ExchangeDeconsolidation
(dollar amounts in thousands)
Total sales$1,876,054 $1,728,842 $147,212 $233,148 $(64,776)$(21,160)
* Net of Products Sold.customer price adjustments, including recoveries
Gross Profit
Nine Months Ended September 30,Variance Due To:
20222021ChangeVolume / Mix*Foreign ExchangeCost Increases / (Decreases)**
(dollar amounts in thousands)
Cost of products sold$1,800,577 $1,669,610 $130,967 $113,720 $(58,619)$75,866 
Gross profit75,477 59,232 16,245 119,428 (6,157)(97,026)
Gross profit percentage of sales4.0 %3.4 %
* Net of customer price adjustments, including recoveries
** Net of deconsolidation
Cost of products sold for the nine months ended September 30, 2017 increased $86.1 million, or 4.1%, compared to the nine months ended September 30, 2016. Costis primarily comprised of products sold increased primarily due to inflation, commodity price pressures, higher production volumesmaterial, labor, manufacturing overhead, freight, depreciation, warranty costs and acquisitions. These items were partially offset by continuous improvement andother direct operating expenses. The Company’s material cost savings. Materials comprise the largest component of our cost of products sold and representedwas approximately 51% and 50%47% of the total cost of products sold for the nine months ended September 30, 20172022 and 2016,2021, respectively. The change in the cost of products sold was impacted by higher volume and mix, commodity inflation, increased labor and overhead costs due to inconsistent volume production schedules, higher compensation related costs and higher energy and transportation costs. These costs were partially offset by foreign exchange, manufacturing efficiencies, purchasing lean savings, restructuring savings and the deconsolidation of a joint venture in the Asia Pacific region.
Gross Profit.Gross profit for the nine months ended September 30, 2017 decreased $3.3 million, or 0.7%2022 increased 27.4%, compared to the nine months ended September 30, 2016.2021. The decrease in gross profitchange was driven primarily by volume and mix net of customer price reductions including recovery of cost increases, manufacturing efficiencies, purchasing lean savings and restructuring savings. These items were partially offset by commodity and wage inflation, commodity price pressureshigher compensation related costs and unfavorable vehicle production mix. As a percentagethe negative impact of sales, gross profit was 18.4% and 19.1% for the nine months ended September 30, 2017 and 2016, respectively.foreign exchange.
Selling, Administration and Engineering.Engineering Expense. Selling, administration and engineering expense includes administrative expenses as well as product engineering and design and development costs. Sales, administration and engineering expense for the nine months ended September 30, 20172022 was $267.9 million or 10.0%7.9% of sales compared to $268.5 million, or 10.3% of sales,9.7% for the nine months ended September 30, 2016. Selling, administration and2021. The decrease was primarily due the non-recurrence of a prior year credit loss, salaried headcount initiative savings, customer recovery of engineering expense, for the nine months ended September 30, 2017 was favorable as a result of lower compensation related costs,and foreign exchange, partially offset by non-cash settlement charges relating to the wind-uphigher compensation related costs.
Gain on Sale of our U.K. pension planBusiness, Net. The gain on sale of $5.7 million, and investments to support growth and innovation.
Impairment charges. Impairment chargesbusiness, net of $4.3$0.7 million for the nine months ended September 30, 2017 resulted from our decision2021 related to divest twothe net effect of our inactive2020 divestitures.
Gain on Sale of Fixed Assets, Net. The gain on sale of fixed assets for the nine months ended September 30, 2022 was attributable to the gain on the sale-leaseback of a European sites based on current real estate market conditions.facility of $33.4 million.
Amortization of Intangibles. Intangible amortization for the nine months ended September 30, 2022 was comparable to the nine months ended September 30, 2021.
30

Restructuring.Restructuring charges for the nine months ended September 30, 20172022 decreased $5.2$21.2 million compared to the nine months ended September 30, 2016.2021. The decrease was primarily driven by lower expenses related to our European initiatives of $7.8 million, partially offset by higher restructuring charges attributedin Europe.
Impairment Charges. Impairment charges for the nine months ended September 30, 2022 decreased $1.0 million, as compared to North America and Asia Pacific of $2.6 million.the nine months ended September 30, 2021. The decrease was driven by lower impairment charges in Europe in the current year period.
Interest Expense, Net.Net interest expense for the nine months ended September 30, 20172022 increased $1.9$3.2 million compared to the nine months ended September 30, 2016, which resulted2022, primarily from higherdue to an increase in interest rates related to the new Senior Notes.on variable rate debt.
Loss on Refinancing and Extinguishment of Debt. Loss on refinancing and extinguishment of debt of $1.0 million for the nine months ended September 30, 2017 resulted from the partial write off of new and unamortized debt issuance costs and unamortized original issue discount related to the amendment of the Term Loan Facility.
Other Expense, Net. Other expense for the nine months ended September 30, 20172022 decreased $5.3$1.6 million compared to the nine months ended September 30, 2016. The decrease was2021, primarily due to the nonrecurrence of underwriting fees related to the secondary offering of $5.9 million recorded in the nine months ended September 30, 2016 and other miscellaneous income, partiallyfavorable foreign currency, offset by increased foreign currency losses.a loss on deconsolidation.


Income Tax Expense (Benefit). Income tax expense for the nine months ended September 30, 20172022 was $40.3$1.8 million on earningslosses before income taxes of $149.9 million. This compares$127.3 million compared to income tax expense of $43.3$15.6 million on earningslosses before income taxes of $151.7$208.5 million for the same period of 2016.nine months ended September 30, 2021. The effective tax rate for the nine months ended September 30, 2017 compared to2022 differed primarily from the nine months ended September 30, 2016 was lower primarily due to nonrecurring discrete items, including the impact of participating in a foreign tax amnesty program, recorded in the nine months ended September 30, 2017. The incomeeffective tax rate for the nine months ended September 30, 2017 varied from statutory rates primarily2021 due to the impactgeographic mix of income taxes on foreign earnings taxed at rates lower than the U.S. statutory rate,pre-tax losses, the inability to record a tax benefit for pre-tax losses in the U.S. and certain foreign jurisdictions due to valuation allowances, discrete tax impacts of the extent not offset bygain on sale transaction in Europe, other categories of income, tax credits, income tax incentives, excess tax benefits related to share-based compensationreserve changes, and other permanent items.items during the nine months ended September 30, 2022. Additionally, a discrete expense of $13.3 million for the initial recognition of valuation allowance against net deferred tax assets in the U.S. was recorded in the nine months ended September 30, 2021.
Segment Results of Operations
Our business is organized into the following reportable segments: North America, Europe, Asia Pacific and South America. All other business activities are reported in Corporate, eliminations and other. The Company uses Segment adjusted EBITDA as the measure of earnings to assess the performance of each segment and determine the resources to be allocated to the segments. We have defined adjusted EBITDA as net income before interest, taxes, depreciation, amortization, restructuring expense, and special items.
The following table presentstables present sales and segment profit (loss)adjusted EBITDA for each of the reportable segments for the three and nine months ended September 30, 2017 and 2016:segments.
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 Change 2017 2016 Change
 (dollar amounts in thousands)
Sales to external customers           
North America$437,406
 $450,795
 $(13,389) $1,403,270
 $1,361,183
 $42,087
Europe254,399
 242,773
 11,626
 776,346
 794,411
 (18,065)
Asia Pacific148,493
 137,174
 11,319
 421,926
 380,483
 41,443
South America28,718
 24,914
 3,804
 78,670
 61,380
 17,290
Consolidated$869,016
 $855,656
 $13,360
 $2,680,212
 $2,597,457
 $82,755
            
Segment profit (loss)           
North America$44,214
 $55,031
 $(10,817) $170,971
 $169,857
 $1,114
Europe(9,024) (5,632) (3,392) (20,633) (7,510) (13,123)
Asia Pacific3,050
 3,037
 13
 11,036
 6,073
 4,963
South America(4,944) (3,265) (1,679) (11,504) (16,685) 5,181
Consolidated income before income taxes$33,296
 $49,171
 $(15,875) $149,870
 $151,735
 $(1,865)
Three Months Ended September 30, 20172022 Compared with Three Months Ended September 30, 20162021
North America.Sales for the three months ended September 30, 2017 decreased $13.4 million, or 3.0%, compared
Three Months Ended September 30,Variance Due To:
20222021Change
Volume/ Mix*
Foreign ExchangeDeconsolidation
(dollar amounts in thousands)
Sales to external customers
North America$351,011 $270,592 $80,419 $80,840 $(421)$— 
Europe113,670 98,682 14,988 34,726 (19,738)— 
Asia Pacific129,493 109,526 19,967 35,932 (9,818)(6,147)
South America27,073 15,981 11,092 11,129 (37)— 
Total Automotive621,247 494,781 126,466 162,627 (30,014)(6,147)
Corporate, eliminations and other35,906 31,909 3,997 6,097 (2,100)— 
Consolidated$657,153 $526,690 $130,463 $168,724 $(32,114)$(6,147)
* Net of customer price adjustments, including recoveries
•Volume and mix, net of customer price adjustments including recoveries, was driven by vehicle production volume increases due to the three months ended September 30, 2016,lessening impact of semiconductor-related supply issues.
•The impact of foreign currency exchange was primarily related to the Euro, Chinese Renminbi and Korean Won.
31

Segment adjusted EBITDA
Three Months Ended September 30,Variance Due To:
20222021Change
Volume/ Mix*
Foreign ExchangeCost (Increases)/ Decreases**
(dollar amounts in thousands)
Segment adjusted EBITDA
North America$19,401 $8,817 $10,584 $29,273 $(1,355)$(17,334)
Europe(10,905)(25,112)14,207 16,942 1,205 (3,940)
Asia Pacific7,523 (14,274)21,797 10,612 (10)11,195 
South America766 (3,422)4,188 2,750 1,060 378 
Total Automotive16,785 (33,991)50,776 59,577 900 (9,701)
Corporate, eliminations and other3,720 132 3,588 9,015 28 (5,455)
Consolidated adjusted EBITDA$20,505 $(33,859)$54,364 $68,592 $928 $(15,156)
* Net of customer price adjustments, including recoveries
** Net of deconsolidation
•Volume and mix, net of customer price adjustments including recoveries, was driven by vehicle production volume increases due to decreased volumea lessening impact on customer production schedules for semiconductor-related supply issues in the current year period.
•The impact of foreign currency exchange was primarily related to the Euro and unfavorable mix and customer price reductions,Brazilian Real, partially offset by the acquisition of AMI Industries’ fuelMexican Peso.
•The Cost (Increases) / Decreases category above includes:
◦Commodity cost and brake business. Segment profit for the three months ended September 30, 2017 decreased by $10.8 million, primarily due to lower volume and unfavorable mix, customer price reductions, and continued investments to support innovation, partially offset by operationalinflationary economics;
◦Manufacturing efficiencies and net material cost savings.purchasing savings through lean initiatives;
Europe. Sales for the three months ended September 30, 2017 increased $11.6 million, or 4.8%, compared◦Increased compensation-related expenses; and
◦Decreased costs related to the three months ended September 30, 2016, primarily due to favorable foreign exchangeongoing salaried headcount initiatives and improved volume and mix. Segment loss for the three months ended September 30, 2017 increased by $3.4 million, primarily due to non-cash settlement charges relating to the wind-up of our U.K. pension plan of $5.7 million and commodity price pressures, partially offset by lower restructuring expense, improved volume and mix and operational efficiencies, including restructuring savings.
Asia Pacific. Sales for the three months ended September 30, 2017 increased $11.3 million, or 8.3%, compared to the three months ended September 30, 2016, primarily due to improved volume and mix and the consolidation of a previously unconsolidated joint venture, partially offset by customer price reductions. Segment profit for the three months ended September 30, 2017 was flat compared to the three months ended September 20, 2016. Continuous improvement and material cost savings were offset by customer price reductions, wage inflation, and higher engineering costs to support growth in the region.
South America. Sales for the three months ended September 30, 2017 increased $3.8 million, or 15.3%, compared to the three months ended September 30, 2016, primarily due to improved volume and mix and favorable foreign exchange, partially


offset by customer price reductions. Segment loss for the three months ended September 30, 2017 increased by $1.7 million primarily due to a $3.1 million pre-tax charge for costs associated with a foreign tax amnesty program, of which $0.2 million was paid in cash, and customer price reductions, partially offset by continuous improvement, volume and mix.
Nine Months Ended September 30, 20172022 Compared with Nine Months Ended September 30, 20162021
North America.Sales for the nine months ended September 30, 2017 increased $42.1 million, or 3.1%, compared to the nine months ended September 30, 2016, primarily
Nine Months Ended September 30,Variance Due To:
20222021Change
Volume/ Mix*
Foreign ExchangeDeconsolidation
(dollar amounts in thousands)
Sales to external customers
North America$1,004,592 $857,153 $147,439 $149,236 $(1,797)$— 
Europe371,371 397,079 (25,708)20,605 (46,313)— 
Asia Pacific319,025 327,666 (8,641)27,397 (14,878)(21,160)
South America74,853 45,620 29,233 26,357 2,876 — 
Total Automotive1,769,841 1,627,518 142,323 223,595 (60,112)(21,160)
Corporate, eliminations and other106,213 101,324 4,889 9,553 (4,664)— 
Consolidated$1,876,054 $1,728,842 $147,212 $233,148 $(64,776)$(21,160)
* Net of customer price adjustments, including recoveries
•Volume and mix, net of customer price adjustments including recoveries, was driven by vehicle production volume increases due to improved volume and mix anda lessening impact on customer production schedules for semiconductor related supply issues in the acquisition of AMI Industries’ fuel and brake business,current year period partially offset by the impact of COVID-19 shutdowns in China and the Ukraine conflict in Europe.
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•The impact of foreign currency exchange was primarily related to the Euro, Chinese Renminbi and Korean Won.
Segment adjusted EBITDA
Nine Months Ended September 30,Variance Due To:
20222021ChangeVolume/ Mix*Foreign ExchangeCost (Increases)/ Decreases**
(dollar amounts in thousands)
Segment adjusted EBITDA
North America$52,338 $50,806 $1,532 $56,443 $(1,857)$(53,054)
Europe(40,878)(40,992)114 25,202 3,545 (28,633)
Asia Pacific(1,018)(13,024)12,006 14,631 (2,599)(26)
South America(941)(6,756)5,815 7,279 2,181 (3,645)
Total Automotive9,501 (9,966)19,467 103,555 1,270 (85,358)
Corporate, eliminations and other775 (79)854 15,873 375 (15,394)
Consolidated adjusted EBITDA$10,276 $(10,045)$20,321 $119,428 $1,645 $(100,752)
* Net of customer price reductions. Segment profit for the nine months ended September 30, 2017 increasedadjustments, including recoveries
** Net of deconsolidation
•Volume and mix, net of customer price adjustments including recoveries, was driven by $1.1 million, primarilyvehicle production volume increases due to continuous improvement, net material cost savings, favorable foreign exchange and acquisitions,a lessening impact on vehicle manufacturers of the semiconductor related supply issues partially offset by customer price reductions, the impact of vehicle production mixCOVID-19 shutdowns in China and continued investments to support innovation.the Ukraine conflict in Europe.
Europe. Sales for the nine months ended September 30, 2017 decreased $18.1 million, or 2.3%, compared•The impact of foreign currency exchange was primarily related to the nine months ended September 30, 2016, primarily due to customer price reductionsEuro and unfavorable foreign exchange,Brazilian Real partially offset by improvement in volumethe Mexican Peso, Chinese Renminbi and mix. Segment loss for the nine months ended September 30, 2017 increased by $13.1 million, primarily dueKorean Won.
•The Cost (Increases) / Decreases category above includes:
◦Commodity cost and inflationary economics;
◦Manufacturing efficiencies and purchasing savings through lean initiatives;
◦Increased compensation-related expenses; and
◦Decreased costs related to non-cash settlement charges relating to the wind-up of our U.K. pension plan of $5.7 million, impairment charges recorded in the first quarter of 2017, customer price reductions, commodity price pressure, product mixongoing salaried headcount initiatives and foreign exchange, partially offset by lower restructuring expense and operational efficiencies, including restructuring savings.
Asia Pacific. Sales for the nine months ended September 30, 2017 increased $41.4 million, or 10.9% compared to the nine months ended September 30, 2016, primarily due to the consolidation of a previously unconsolidated joint venture and improved volume and mix, partially offset by unfavorable foreign exchange and customer price reductions. Segment profit for the nine months ended September 30, 2017 increased by $5.0 million primarily driven by continuous improvement and material cost savings, partially offset by customer price reductions, higher engineering costs to support growth in the region and wage inflation.
South America. Sales for the nine months ended September 30, 2017 increased $17.3 million, or 28.2%, compared to the nine months ended September 30, 2016, primarily due to improved volume and mix and favorable foreign exchange. Segment loss for the nine months ended September 30, 2017 improved by $5.2 million primarily due to continuous improvement and net material cost savings and improved volume and mix, partially offset by a $3.1 million pre-tax charge for costs associated with a foreign tax amnesty program, of which $0.2 million was paid in cash.
Liquidity and Capital Resources
Short and Long-Term Liquidity Considerations and Risks
We intendThe sources to fund our ongoing working capital, capital expenditures, debt service and other funding requirements throughare a combination of cash flows from operations, cash on hand, borrowings under our senior asset-based revolving credit facility (“ABL Facility”) and receivables factoring. The Company utilizes intercompany loans and equity contributions to fund its worldwide operations. There may be country-specific regulations which may restrict or result in increased costs in the repatriation of these funds. See Note 7.9. “Debt” to the unaudited condensed consolidated financial statements included in Part 1,I, Item 1 of this Report for additional information.
Based onWe continue to actively preserve cash and enhance liquidity, including decreasing our currentcapital expenditures. We continuously monitor and anticipated levels of operationsforecast our liquidity situation, take the necessary actions to preserve our liquidity and evaluate other financial alternatives that may be available to us should the condition in our markets and industry, we believe that our cash flows from operations, cash on hand, borrowings under our ABL Facility and receivables factoring will enable us to meet our ongoing working capital, capital expenditures, debt service and other funding requirements for the next twelve months. However, ourneed arise. Our ability to fund our working capital needs, debt payments and other obligations, and to comply with the financial covenants, including borrowing base limitations, under our ABL Facility, depend on our future operating performance and cash flowflows and many factors outside of our control, including the costs of raw materials, the state of the overall automotive industry and financial and economic conditions, including the continued impact of COVID-19, and other factors. Based on those actions and current projections of OEM customer production, we believe that our cash flows from operations, cash on hand, borrowings under our ABL Facility and receivables factoring will enable us to meet our ongoing working capital requirements and capital expenditures for the next twelve months, despite the challenges presented by the COVID-19 pandemic and supply chain issues facing the industry. Our ability to meet our debt service requirements for the next twelve months is contingent upon our ability to refinance our Term Loan Facility.

33

Our Term Loan Facility matures on November 2, 2023. The Company has retained Goldman Sachs & Co. LLC as its financial advisor to analyze, evaluate and help arrange a refinancing of the Term Loan Facility and possibly certain other debt instruments. To the extent the Company is not able to refinance its Term Loan Facility prior to the issuance of the financial statements for the year ended December 31, 2022, our independent auditors may issue an audit opinion including an explanatory paragraph that indicates there is substantial doubt about our ability to continue as a going concern. The inclusion of such an explanatory paragraph in the report of our independent auditors would breach a covenant under our Term Loan Facility which, unless cured, would constitute an event of default thereunder. Such an event of default would cause a cross-default or cross-acceleration of other indebtedness. In such a case, the Company would not expect that it would have sufficient liquidity to repay all of its outstanding indebtedness at such time. The Company continues its discussions with certain investors with respect to potential refinancing alternatives. While discussions are ongoing, the Company has not reached an agreement with respect to such a transaction for refinancing its capital structure and there can be no assurances that such an agreement will be reached in the future.
Cash Flows
Operating Activities. Net cash provided byused in operations was $104.6$10.4 million for the nine months ended September 30, 2017,2022, compared to $182.0net cash used in operations of $111.5 million for the nine months ended September 30, 2016.2021. The net change was primarily driven by an increase in receivables due to customer payment timingimproved operating results and repurchasethe receipt of receivables as part of$54.3 million in cash payments from the transition to a pan-European factoring program, increased inventory and higher paymentsUnited States Internal Revenue Service for tax refunds related to incentive compensation, partially offset by increased cash earnings and reduced cash paid for restructuring and taxes.net operating loss carrybacks.
Investing Activities. Net cash used in investing activities was $136.7$5.4 million for the nine months ended September 30, 2017,2022, compared to $150.7net cash used in investing activities of $72.8 million for the nine months ended September 30, 2016. Cash2021. The change was primarily related to proceeds of $50.0 million related to the sale-leaseback of a certain European facility which were received in the nine months ended September 30, 2022 along with reduced capital spending in 2022. We expect to continue initiatives to reduce overall capital spending and anticipate that we will spend approximately $80 - $90 million on capital expenditures in 2022.
Financing Activities. Net cash used in investingfinancing activities consisted


primarily of capital spending of $137.4 million and $116.8totaled $6.1 million for the nine months ended September 30, 2017 and 2016, respectively. We anticipate that we will spend approximately $165 million2022, compared to $175 million on capital expenditures in 2017.
Financing Activities. Netnet cash used inprovided by financing activities totaled $52.1of $4.7 million for the nine months ended September 30, 2017, compared to $41.3 million for2021. The outflow in 2022 was relatively consistent with the nine months ended September 30, 2016. The increase was primarily due to increased repurchase activity under our share repurchase program, certain paydowns of foreign bank loansoutflow in 2017 and decreased warrant exercises.2021.
Share Repurchase Program
In March 2016,June 2018, our Board of Directors approved a securitiescommon stock repurchase program (the “Program”“2018 Program”) authorizing us to repurchase, in the aggregate, up to $125$150.0 million of our outstanding common stock or warrants to purchase common stock. Under the 2018 Program, repurchases may be made on the open market, or through private transactions, accelerated share repurchases, round lot or block transactions on the New York Stock Exchange or otherwise, as determined by our managementus and in accordance with prevailing market conditions and federal securities laws and regulations.
In March 2016, we purchased $23.8 million of our common stock (350,000 shares at $68.00 per share) from the Selling Stockholders (as described in Note 15. “Common Stock” to the unaudited condensed consolidated financial statements included in Part I, Item 1 of this Report). In 2017, we repurchased $31.5 million of our common stock (306,072 shares at an average purchase price of $102.76 per share, excluding commissions) in the open market, of which $30.7 million was settled in cash during the nine months ended September 30, 2017. We expect to fund any future repurchases from cash on hand and future cash flows from operations. The specific timing and amount of any future repurchase will vary based on market and business conditions, changes in tax laws (including the Inflation Reduction Act) and other factors. We are not obligated to acquire a particular amount of securities, and the 2018 Program may be discontinued at any time at our discretion. As of September 30, 2017,2022, we havehad approximately $69.7$98.7 million of repurchase authorization remaining under the 2018 Program.We did not make any repurchases under the 2018 Program during the nine months ended September 30, 2022 or 2021.
Non-GAAP Financial Measures
In evaluating our business, management considers EBITDA and Adjusted EBITDA to be key indicators of our operating performance. Our management also uses EBITDA and Adjusted EBITDA:
•because similar measures are utilized in the calculation of the financial covenants and ratios contained in our financing arrangements;
•in developing our internal budgets and forecasts;
•as a significant factor in evaluating our management for compensation purposes;
•in evaluating potential acquisitions;
•in comparing our current operating results with corresponding historical periods and with the operational performance of other companies in our industry; and
•in presentations to the members of our board of directors to enable our board of directors to have the same measurement basis of operating performance as is used by management in their assessments of performance and in forecasting and budgeting for our company.
In addition, we believe EBITDA and Adjusted EBITDA and similar measures are widely used by investors, securities analysts and other interested parties in evaluating our performance. We define Adjusted EBITDA as net income (loss) plus income tax expense (benefit), interest expense, net of interest income, depreciation and amortization or EBITDA, as adjusted
34

for items that management does not consider to be reflective of our core operating performance. These adjustments include, but are not limited to, restructuring costs, impairment charges, non-cash fair value adjustments and acquisition-related costs.
EBITDA and Adjusted EBITDA are not financial measurements recognized under U.S. GAAP, and when analyzing our operating performance, investors should use EBITDA and Adjusted EBITDA as a supplement to, and not as alternatives for, net income (loss), operating income, or any other performance measure derived in accordance with U.S. GAAP, nor as an alternative to cash flow from operating activities as a measure of our liquidity. EBITDA and Adjusted EBITDA have limitations as analytical tools, and they should not be considered in isolation or as substitutes for analysis of our results of operations as reported under U.S. GAAP. These limitations include:
 
•they do not reflect our cash expenditures or future requirements for capital expenditure or contractual commitments;
•they do not reflect changes in, or cash requirements for, our working capital needs;
•they do not reflect interest expense or cash requirements necessary to service interest or principal payments under our ABL Facility, Term Loan Facility, Senior Notes and Senior Secured Notes;
•they do not reflect certain tax payments that may represent a reduction in cash available to us;
•although depreciation and amortization are non-cash charges, the assets being depreciated or amortized may have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect cash requirements for such replacements; and


•other companies, including companies in our industry, may calculate these measures differently and, as the number of differences in the way companies calculate these measures increases, the degree of their usefulness as a comparative measure correspondingly decreases.
In addition, in evaluating Adjusted EBITDA, it should be noted that in the future, we may incur expenses similar to the adjustments in the below presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by special items.
35

The following table provides a reconciliation of EBITDA and Adjusted EBITDA from net income,loss, which is the most comparable financial measure in accordance with U.S. GAAP:
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
(dollar amounts in thousands)
Net loss attributable to Cooper-Standard Holdings Inc.$(32,686)$(123,173)$(127,293)$(220,648)
Income tax (benefit) expense(833)32,121 1,824 15,598 
Interest expense, net of interest income20,747 18,243 57,378 54,152 
Depreciation and amortization30,628 36,049 94,173 105,021 
EBITDA$17,856 $(36,760)$26,082 $(45,877)
Restructuring charges1,701 1,573 13,014 34,251 
Deconsolidation of joint venture (1)
— — 2,257 — 
Impairment charges (2)
379 1,006 837 1,847 
Loss (gain) on sale of business, net (3)
— — — (696)
Gain on sale of fixed assets, net (4)
— — (33,391)— 
Lease termination costs (5)
— 322 — 430 
Indirect tax and customs adjustments (6)
569 — 1,477 — 
Adjusted EBITDA$20,505 $(33,859)$10,276 $(10,045)
(1)Loss attributable to deconsolidation of a joint venture in the Asia Pacific region, which required adjustment to fair value.
(2)Non-cash impairment charges in 2022 and 2021 related to idle assets in Europe.
(3)During 2021, we recorded subsequent adjustments to the net gain on sale of business, which related to the 2020 divestiture of our European rubber fluid transfer and specialty sealing businesses, as well as its Indian operations.
(4)In the first quarter of 2022, the Company signed a sale-leaseback agreement on one of its European facilities, and a gain was recognized in the second quarter of 2022.
(5)Lease termination costs no longer recorded as restructuring charges in accordance with ASC 842.
(6)Impact of prior period indirect tax and customs adjustments.





36
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
 (dollar amounts in thousands)
Net income attributable to Cooper-Standard Holdings Inc.$24,640
 $36,362
 $106,802
 $107,874
Income tax expense7,838
 12,525
 40,258
 43,312
Interest expense, net of interest income10,256
 10,114
 31,788
 29,861
Depreciation and amortization34,368
 31,325
 99,413
 91,699
EBITDA$77,102
 $90,326
 $278,261
 $272,746
Restructuring charges9,909
 10,430
 28,220
 33,468
Settlement charges (1)
5,902
 —
 5,902
 —
Foreign tax amnesty program (2)
3,121
 —
 3,121
 —
Impairment charges (3)
—
 —
 4,270
 —
Loss on refinancing and extinguishment of debt (4)
—
 —
 1,020
 —
Secondary offering underwriting fees and other expenses (5)
—
 —
 —
 6,500
Other—
 —
 —
 155
Adjusted EBITDA$96,034
 $100,756
 $320,794
 $312,869
(1)Non-cash settlement charges of $5.7 million and administrative fees of $0.2 million relating to the U.K. pension plan.
(2)Relates to indirect taxes recorded in cost of products sold.
(3)Impairment charges related to fixed assets.
(4)Loss on refinancing and extinguishment of debt related to the May 2017 amendment of the Term Loan Facility.
(5)Fees and other expenses associated with the March 2016 secondary offering.

Contingencies and Environmental Matters
The information concerning contingencies, including environmental contingencies and the amount currently held in reserve for environmental matters, contained in Note 18.19. “Commitments and Contingencies” to the unaudited condensed consolidated financial statements included in Part I, Item 1 of this Report, is incorporated herein by references.reference.
Recently Issued Accounting Pronouncements
See Note 1. “Overview” to the unaudited condensed consolidated financial statements included in Part I, Item 1 of this Report.
Critical Accounting Estimates
There have been no significant changes in our critical accounting estimates during the nine months ended September 30, 2017.2022.
Forward-Looking Statements
This quarterly report on Form 10-Q includes “forward-looking statements” within the meaning of U.S. federal securities laws, and we intend that such forward-looking statements be subject to the safe harbor created thereby. Our use of words “estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,” “believe,” “outlook”, “guidance”, “forecast,” or future or conditional verbs, such as “will,” “should,” “could,” “would,” or “may,” and variations of such words or similar expressions are intended to identify


forward-looking statements. All forward-looking statements are based upon our current expectations and various assumptions. Our expectations, beliefs, and projections are expressed in good faith and we believe there is a reasonable basis for them. However, we cannot assure you that these expectations, beliefs and projections will be achieved. Forward-looking statements are not guarantees of future performance and are subject to significant risks and uncertainties and other factors that may cause actual results or achievements to be materially different from the future results or achievements expressed or implied by the forward-looking statements. Among other items, such factors may include: Volatility or decline of the Company’s stock price, or absence of stock price appreciation; impacts, including commodity cost increases and disruptions related to the war in Ukraine and the current COVID-related lockdowns in China; our ability to offset the adverse impact of higher commodity and other costs through negotiations with our customers; the impact, and expected continued impact, of the COVID-19 outbreak on our financial condition and results of operations; significant risks to our liquidity presented by the COVID-19 pandemic risk; prolonged or material contractions in automotive sales and production volumes; our inability to realize sales represented by awarded business; escalating pricing pressures; loss of large customers or significant platforms; our ability to successfully compete in the automotive parts industry; availability and increasing volatility in costs of manufactured components and raw materials; disruption in our supply base; competitive threats and commercial risks associated with our diversification strategy through our Advanced Technology Group; possible variability of our working capital requirements; risks associated with our international operations;operations, including changes in laws, regulations, and policies governing the terms of foreign trade such as increased trade restrictions and tariffs; foreign currency exchange rate fluctuations; our ability to control the operations of our joint ventures for our sole benefit; our substantial amount of indebtedness;indebtedness and variable rates of interest; our ability to obtain adequate financing sources in the future; operating and financial restrictions imposed on us under our debt instruments; the underfunding of our pension plans; significant changes in discount rates and the actual return on pension assets; effectiveness of continuous improvement programs and other cost savings plans; manufacturing facility closings or consolidation; our ability to execute new program launches; our ability to meet customers'customers’ needs for new and improved products; the possibility that our acquisitions and divestitures may not be successful; product liability, warranty and recall claims brought against us; laws and regulations, including environmental, health and safety laws and regulations; legal and regulatory proceedings, claims or investigations against us; work stoppages or other labor disruptions; the ability of our intellectual property to withstand legal challenges; cyber-attacks, ordata privacy concerns, other disruptions in, or the inability to implement upgrades to, our information technology systems; the possible volatility of our annual effective tax rate; the possibility of a failure to maintain effective controls and procedures; the possibility of future impairment charges to our goodwill and long-lived assets; our ability to identify, attract, develop and retain a skilled, engaged and diverse workforce; our ability to procure insurance at reasonable rates; and our dependence on our subsidiaries for cash to satisfy our obligations.
You should not place undue reliance on these forward-looking statements. WeOur forward-looking statements speak only as of the date of this quarterly report on Form 10-Q, and we undertake no obligation to publicly update or otherwise revise any forward-looking statement, whether as a result of new information, future events or otherwise, except where we are expressly required to do so by law.
This quarterly report on Form 10-Q also contains estimates and other information that is based on industry publications, surveys, and forecasts. This information involves a number of assumptions and limitations, and we have not independently verified the accuracy or completeness of the information.
Item 3.        Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes to the quantitative and qualitative information about the Company’s market risk from those previously disclosed in the Company’s 20162021 Annual Report.
37

Item 4.        Controls and Procedures
Evaluation of Disclosure Controls and Procedures
The Company has evaluated, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Report. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. Based on that evaluation, the Company’s Chief Executive Officer along with the Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective at a reasonable assurance level as of the end of the period covered by this Report.
Changes in Internal Control over Financial Reporting
There have been no changes in the Company’s internal control over financial reporting during the quarter ended September 30, 20172022 that have materially affected, or are reasonably likely to affect, the Company’s internal control over financial reporting.

38


PART II — OTHER INFORMATION

Item 2.        Unregistered Sales of Equity Securities and Use of Proceeds
(c) Purchases of Equity Securities By the Issuer and Affiliated Purchasers
The Company is authorized to purchase, in the aggregate, up to $150 million of our outstanding common stock under our common stock repurchase program, which was effective in November 2018. As of September 30, 2022, we had approximately $98.7 million of repurchase authorization remaining under our common stock share repurchase program as discussed in Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Share Repurchase Program,” and Note 15.17. “Common Stock” to the unaudited condensed consolidated financial statements included in Part 1,I, Item 1 of this Report, we have approximately $69.7 million of repurchase authorization remaining under our ongoing common stock share repurchase program.Report.
A summary of our shares of common stock repurchased during the three months ended September 30, 20172022 is shown below:below:
Period
Total Number of Shares Purchased(1)
Average Price Paid per ShareTotal Number of Shares Purchased as Part of Publicly Announced Plans or ProgramsApproximate Dollar Value of Shares that May Yet be Purchased Under the Program (in millions)
July 1, 2022 through July 31, 20222,152 $4.90 — $98.7 
August 1, 2022 through August 31, 2022255 10.96 — 98.7 
September 1, 2022 through September 30, 2022— — — 98.7 
Total2,407 — 
(1)Represents shares repurchased by the Company to satisfy employee tax withholding requirements due upon the vesting of restricted stock awards.
39
Period 
Total Number of Shares Purchased(1)
 Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet be Purchased Under the Program (in millions)
July 1, 2017 through July 31, 2017 71,671
 $103.63
 71,663
 $84.5
August 1, 2017 through August 31, 2017 76,038
 $100.56
 76,000
 $76.8
September 1, 2017 through September 30, 2017 66,003
 $107.02
 66,000
 $69.7
Total 213,712
 $103.58
 213,663
 $69.7
(1)Includes 49 shares repurchased by the Company to satisfy employee tax withholding requirements due upon the vesting of restricted stock awards.






Item 6.        Exhibits
Exhibit
No.
Exhibit
No.
Description of Exhibit
31.1*10.1*†
31.1*
31.2*
32**
101.INS***Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH***Inline XBRL Taxonomy Extension Schema Document
101.CAL***Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF***Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB***Inline XBRL Taxonomy Label Linkbase Document
101.PRE***Inline XBRL Taxonomy Extension Presentation Linkbase Document
104***Cover Page Interactive Data File, formatted in Inline XBRL
*Filed with this Report.
**Furnished with this Report.
***Submitted electronically with this Report in accordance with the provisions of Regulation S-T.
†Management contract or compensatory plan or arrangement.

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
COOPER-STANDARD HOLDINGS INC.    
COOPER-STANDARD HOLDINGS INC.    
November 1, 20172, 2022/S/ JONATHAN P. BANAS
Date
Jonathan P. Banas
Chief Financial Officer
(Principal Financial Officer)



INDEX TO EXHIBITS
Exhibit
No.
Description of Exhibit
31.1*
Certification of Principal ExecutiveJonathan P. Banas
Chief Financial Officer Pursuant to Exchange Act Rule 13a-14(a)/15d-14(a) (Section 302 of the Sarbanes-Oxley Act of 2002).
31.2*
Certification of
(Principal Financial Officer Pursuant to Exchange Act Rule 13a-14(a)/15d-14(a) (Section 302 of the Sarbanes-Oxley Act of 2002).
32**
Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS***XBRL Instance Document
101.SCH***XBRL Taxonomy Extension Schema Document
101.CAL***XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF***XBRL Taxonomy Extension Definition Linkbase Document
101.LAB***XBRL Taxonomy Label Linkbase Document
101.PRE***XBRL Taxonomy Extension Presentation Linkbase Documentand Duly Authorized Officer)
41
*Filed with this Report.
**Furnished with this Report.
***Submitted electronically with this Report in accordance with the provisions of Regulation S-T.


35